Eskom told to 'think smarter'

“Think smarter and don't spend more,” is the message from ICT alliance Smart Grid Consortium to national electricity supplier Eskom and the National Energy regulator of SA (Nersa).

The Smart Grid Consortium consists of US networking equipment maker Cisco, IT groups Fujitsu and IBM, and local telecommunications utility UniNet.

The alliance presented its submission to Nersa yesterday as part of the public process into the call by Eskom to hike tariffs by up to 34% to help fund its capital expenditure programme.

Eskom's application for the electricity tariff hike has sparked the ire of the private and public sectors and organised labour. The electricity utility states it needs to spend R385 billion in the next five years and eventually R1.3 trillion up until 2025, to recapitalise the country's generation capacity.

However, the Smart Grid Consortium, in its Nersa submission, states alternative solutions exist and massive recapitalisation is not the only option. Alternatives are being demonstrated in countries such as the US, to avoid massive infrastructure spend and to minimise carbon footprint, it notes.

“In the US and UK and many other leading G8 countries, aggressive public works programmes, aimed at improving the efficiency of electricity distribution and reducing the carbon footprint, are hailed as one of the major components of the stimulus packages to re-invigorate economies back out of recession. In SA, we are doing the reverse, not addressing the inefficiencies in our current distribution network, over-capitalising on extra unneeded generation capacity,” the submission states.

It adds it has always been debatable whether the capacity upgrade was needed, as other factors, such as poor maintenance, could have been blamed for the outages in 2007, and it was always clear that managing peak usage was the critical failure of the Eskom grid.

The Smart Grid Consortium says it firmly believes an alternative solution can be found that would save the country millions. These savings can be used to finance the social and economic upliftment programmes that government may have to trim due to the economic recession, it explains.

“SA is a global leader in meter technology and houses some of the global leaders at the forefront of smart meter technology development. This industry is willing and able to deliver on the challenge to better manage existing capacity, improve the carbon footprint, and to provide better service to electricity consumers,” the submission says.

While the use of a smart grid may not totally eliminate the need for increased power generation capacity, it promises significantly reduced capital spend by government, while, at the same time, involving a labour-intensive public works programme.

“The value of a smart grid is exponentially increased when one considers the impact on debt management with consumers of utility services, such as electricity and water, which has reached crisis proportions, threatening the financial viability of many municipalities,” the Smart Grid Consortium submission states.