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Eskom pushes for independent power in mines

Read time 3min 30sec

Increased use of renewable energy, combined with investments by private capital, could be the winning formula SA needs for its energy mix, according to Eskom CEO Andre de Ruyter.

The new Eskom boss said in the longer term, generation of independent power will be positive for the country. According to a Sunday Times report, De Ruyter wants mines to produce their own electricity so pressure can be taken off the national grid.

His call comes on the back of the African National Congress (ANC) commitment to build new growth areas such as renewable energy.

At the ANC national executive committee lekgotla held last week in Irene, it said energy transformation in SA would reduce net costs and bring significant socio-economic benefits, such as increased economic growth, job creation and overall welfare gains.

The Sunday Times report says as Eskom faces myriad challenges, maintenance backlogs and crippling load-shedding, De Ruyter is welcoming plans for mines to begin generating their own power as a means of easing pressure on the grid.

Despite mines providing a significant ratio of Eskom’s revenue, De Ruyter says in the immediate future, it will be beneficial if the mining industry generated its own power.

In the last financial year, mines contributed about R30.3 billion to Eskom's revenue of R193 billion, according to figures provided by Eskom.

“We need to crowd in private capital to contribute to power generation in SA and whether that be through renewables or other forms of generation is a good thing…We think it gives us the necessary headroom to do what needs to be done,” he is quoted as saying.

De Ruyter says further: “I’m not that concerned about it because I think in the short-term that would be a positive development, because it allows us access to electricity that is currently being generated. We can then use it to add to our own supply.”

Additionally, he said having access to more power would allow Eskom to perform maintenance on its infrastructure. It would also prevent mines from having to stop operations due to a lack of power.

Commenting on the ANC endorsement of a market-friendly approach to South Africa’s constrained energy supply, the South African Wind Energy Association (SAWEA) said it supports the approach of relooking at how energy is supplied so that the system can evolve and adapt to fit the country’s increasing energy demand.

“To shift away from a centralised monopoly to a more efficient decentralised generation model will increase competition and drive down energy prices. This will ultimately stimulate the economy and support the growth that South Africa is seeking, in line with a global shift away from large centralised utilities. However, the focus needs to remain on implementing the country’s resource plan in order to address the short- and long-term electricity supply capacity constraints and to ensure sustainable economic growth,” says Ntombifuthi Ntuli, CEO of SAWEA.

Meanwhile, finance minister Tito Mboweni has not ruled out the inclusion of nuclear power into the electricity grid due to Eskom’s perennial challenges.

Speaking on the sidelines of the World Economic Forum meeting in Davos, Switzerland, on Friday, Mboweni said government needed to “honestly think” about nuclear power in order for Eskom to meet the country’s energy demands.

He told journalists: “I’m sure you have heard the minister of minerals and energy saying we need to seriously begin even to think about nuclear very seriously, in an open and transparent way because the energy needs for South Africa are big.

“And particularly given the fact that the energy needs for South Africa are actually the southern African energy needs because of the interrelationship of the southern African political economy and the role of Eskom in the region’s energy mix.”

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