Is Eskom the new Telkom?
Posted on October 30th, 2009 by Richard Catto 1,727 views
Many South Africans are beginning to think so. Like telecommunications, electricity is a basic need for every South African. Even those without an electricity supply themselves, depend on the goods and services that are produced with electricity.
Eskom has already hit South Africans with two massive price hikes: 27% last year and 31.3% this year. Earlier this month, on October 14, Eskom CEO, Jacob Maroga, announced that he wants a 45% increase each year for the next 3 years. This outrageous demand has led to widespread shock and anger.
Today, it is rumoured that the board of Eskom has asked Maroga to resign. Could this be the beginning of a new more rational response to South Africa’s energy crisis?
In September 2009, the Mail & Guardian reported that the reason why South Africa experienced massive power outages and load shedding in January 2008 was because Eskom had totally bungled their management of coal. Furthermore, in an Eskom report dated mid 2007, this problem had already been reported to Maroga by an American consultant, Susan Olsen, but no action was taken to prevent what turned out to be a major national disaster and embarrassment for South Africa the following year.
As Harry Truman famously used, the buck stops at Maroga’s desk and it seems that that buck is now kicking the crap out of him. We can hope.
FURTHER READING:
Eskom board asks CEO Maroga to resign
Eskom board asks CEO Maroga to resign – report
Eskom’s proposed hike ‘a serious shock to economy’
Cosatu outraged over Eskom’s proposed 45% hike
CEO scores R5m amid new claims of incompetence
Tags: Eskom, Jacob Maroga
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Eskom shelves Koeberg II nuclear power station
Posted on December 5th, 2008 by Richard Catto 2,185 views
Eskom announced today that the bid to build a second nuclear power station on the site of the existing Koeberg nuclear power station has been ended and that they are not going forward with the project at this time. The reason given by Eskom is that the project is too costly for them.
It has been estimated that the project was going to cost Eskom in the region of (US$10-12 billion) R100-120 billion. However this is not news to Eskom. In September 2007, an article in Engineering news makes it clear that Eskom was aware that it would definitely cost more than the R80 billion they were spending on developing another coal fired plant at Lephalale.
Yesterday, the World Bank approved in principle a loan of US$5 billion to Eskom over the next 5 years.
So if Eskom knew the project was going to cost about R100 billion over a year ago, and they expressed total confidence then that this new reactor was going to be built as soon as possible, and they have been approved a massive loan for the amount they asked, why this ridiculous decision then to abandon the project?
I can only speculate that the real reason is that South Africa plans to renege on Kyoto 2012, when carbon taxes come into effect that would make coal fired power stations more expensive than nuclear power stations. If South Africa reneges and refuses to pay the carbon tax, then coal fired stations are a much cheaper option and Eskom will probably divert most of its budget into building as many coal fired power stations as it can.
Tags: Eskom
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South Africa’s new Energy Policy abandons coal
Posted on July 29th, 2008 by Richard Catto 1,671 views
Marthinus van Schalkwyk, South Africa’s Minister of the Environment, announced a new energy policy yesterday that moves away from using predominantly dirty coal for the generation of electricity.
The new policy, recently agreed by Cabinet, is driven by environmental concerns. According to United Nations climate predictions, global warming presents the greatest threat to Africa (of all the continents).
Van Schalkwyk believes that if South Africa takes action now, our greenhouse gas emissions would stabilise by 2025, whereafter it would start declining. South Africa is also pushing the United States and other developed nations to play their part in combating global warming. South Africa wants developed nations to cut their greenhouse gas emissions by 25 – 40% by 2025 and by 85 – 90% by 2050. So far this has met with resistance.
The South African government plans to introduce concrete measures by 2009 which would include compulsory energy savings measures and possibly a carbon tax.
Currently 90% of South Africa’s energy is generated by coal fired power stations. Eskom still has plans to build one new coal fired power station by 2013 and bring two retired ones back into production to boost electricity production in the short term. Recent shortfalls in electricity supplies have dampened the rate of growth of the South African economy.
In the longer term, however, the government will only allow the construction of carbon neutral power stations. These would include a new nuclear power station planned to be built alongside the existing Koeberg nuclear power station in Cape Town, and other alternative forms of energy such as wind farms and solar energy.
South Africa has the world’s cheapest coal-fired electricity at 22 cents per Kilowatt per hour.
FURTHER READING:
South African says it will shift energy policy from coal to combat climate change
Tags: electricity, Eskom, global warming, Koeberg, Marthinus van Schalkwyk
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A primer for South African pessimists: how to cope with the current energy crisis
Posted on January 20th, 2008 by Richard Catto 5,900 views
Reading a number of blogs, I’ve discerned a common theme – rampant pessimism and predictions of certain doom for all of us, as a direct result of the current energy crisis.
I find it amazing how some South Africans are so eager and quick to paint South Africa in the darkest possible shades of black, given any setback. It’s as if the problems which afflict us are unique and discernible nowhere else in the world. For every problem that arises in SA, the knee-jerk answer is that these things do not and could not possibly occur elsewhere, ever. The implied theme is that a BLACK government, any BLACK government, is incompetent and incapable of responsibly governing any country.
Fact is, California experienced an electricity crisis which lasted from June 2000 through November 2003. This crisis was precipitated by market manipulation by the State of California. They imposed price controls which led to a situation where utility companies had to pay more for electricity than they could sell it for, and so production (of electricity) fell, companies went bankrupt and consumers experienced rolling black-outs.
I’d like to emphasize that this happened in a FIRST WORLD country. Furthermore, the State of California has the largest economy of all the states in the US. So it really is disingenuous to continually conclude that mismanagement, flawed delivery and total screw ups are the sole purview of Third World countries. Corruption happens everywhere, every day.
I’m very confident that any and all mishaps that occur in South Africa will be met with the same predictable response – black governments are useless!
If a bridge were to collapse, for instance, I’m certain that a million or more unhappy South Africans would make odious comparisons between our country and first world countries. I’m waiting for that to occur, and while I wait, I’m keeping this bit of ammo in reserve:
Design flaw cited in U.S. bridge collapse
Not that I’m expecting the imminent collapse of any bridges, but you never know. What I’m saying here is that people all over the world make mistakes, act irresponsibly, make incorrect predictions about the pace of growth of an economy and otherwise manage to fuck things up in all the same ways that we do.
In a way, it is actually a compliment that we are experiencing this electricity crisis because it came about due to our economy’s unexpected high growth rate – much higher than expectations. That is a good thing, per se. The only thing that makes it bad, is that we have temporarily run out of power to keep it all aglow and working.
So, although, the power crisis is apparently set to grow worse in the immediate short term, it doesn’t mean that things will remain that way.
The question you gotta ask yourself, is "Do you want to be part of the problem or part of the solution?"
Here’s the Problem:
And here’s an example of a solution (there are more):
- Toshiba Builds Ultra-Small Nuclear Reactor
- Village invited to test cheap, clean nuclear power
- Toshiba Builds 100x Smaller Micro Nuclear Reactor
What do I think is going to happen?
I think that South African businesses will find creative solutions to solve their energy problems. I believe that Eskom and the South African government will take effective measures to limit the damage to our economy.
The IOL article (linked above) lists several measures that Eskom is taking to resolve this problem, among them a subsidy program to assist homeowners to install solar heat. Eskom is actually prepared to pay part of your costs to install solar panels, if you wish to do so now. That’s something you will enjoy benefits from long after the energy crisis is over.
So, please my fellow South Africans, it’s not all doom and gloom.
The real question you should be asking yourself (if this applies to you) is why are you so prepared to believe the worst every time something goes wrong?
Why do you really lack confidence in South Africa?
Is it a black thing?
Tags: energy crisis in South Africa, Eskom, is it a black thing?
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