Eskom Contemplates a Delay in the Shutdown of Coal-Fired Power Stations

Eskom, South Africa's state-owned electricity utility, is considering a delay in the shutdown of its coal-fired power stations, according to Vikesh Rajpaul, the General Manager of the Just Energy Transition at Eskom. Rajpaul clarified that this delay is not aimed at extending the lifespan of these power stations but rather at optimizing their usage by continuing their operations beyond their originally scheduled decommissioning dates.

Speaking at the Joburg Indaba mining conference in Johannesburg, Rajpaul emphasized Eskom's commitment to addressing the environmental impact of carbon emissions on climate change. Despite this commitment, Eskom believes that the transition to cleaner energy sources must be socially just and considerate of the impact on jobs and local economies.

When asked about whether this decision to extend coal-fired power generation might affect the donor funding Eskom received in 2021, Rajpaul mentioned ongoing discussions with funders at the "presidential level." South Africa had been promised $8.5 billion in financing for its just energy transition program at the COP26 climate conference in Glasgow in 2021 by countries such as France, Germany, the UK, US, and the European Union. Delaying the transition away from coal-fired power generation could potentially raise concerns about South Africa meeting the conditions set by these donor countries.

Rajpaul stated that Eskom's goal is to continue operating some of its coal-fired power stations until 2030. However, the final decision lies with the Minister of Environmental Affairs, who would need to allow for special arrangements regarding minimum emission standards (MES) requirements. The MES place restrictions on emissions and climate commitments, which Eskom needs to meet.

Continued operations of these coal-fired power stations are contingent on certain technical conditions, including the adequacy of past maintenance efforts to ensure safe ongoing operations. Eskom's maintenance programs have faced challenges due to a lack of funding, primarily stemming from tariffs that were not cost-reflective.

Eskom has consistently faced difficulties in obtaining tariff increases as per its requests and has even resorted to legal action. The shortfall in tariff increases compared to what Eskom requested has hindered the utility's ability to plan and execute necessary maintenance, impacting its energy availability factor.

Furthermore, Eskom has decided to separate the decommissioning of power stations from their repurposing and repowering efforts. This decision comes in response to criticisms regarding the decommissioning of the Komati power station, located in Mpumalanga, which had a detrimental impact on surrounding communities. Rajpaul acknowledged that lessons have been learned from the Komati experience.

Eskom now aims to ensure that economic activity continues at decommissioned power stations, avoiding a repeat of the negative consequences witnessed at Komati. This will involve conducting socio-economic impact assessments and creating new economic opportunities at other power stations. These opportunities may not necessarily be related to electricity generation but could involve activities such as the manufacturing of containerized microgrids, ash beneficiation, and recycling initiatives, as outlined by Rajpaul.