The JSE offers instruments to enable companies to raise funds for renewable energy projects. Picture: 123RF/VACLAW VOLRABentury, South Africans welcomed the news that President Cyril Ramaphosa’s new energy plan will add a third of the power required in worst-case scenarios over the next three months by drawing the private sector and green sources into electricity generation.
That last point is key, as insiders say the massive turbines — the very heart of power generation — at several of its decrepit power stations are in poor repair, while some suppliers of coal have been seditiously and fraudulently bulking their consignments with rock, damaging the coal crushers that process the power stations’ fuel.
Eskom’s own 2019 annual report sounded a warning note on green energy: “It remains a concern that IPP purchases were 4.8% of total generating production, while their cost represented 25% of the total primary energy cost.” Something is obviously wrong with the economic model.
Bloomberg noted that other ideas to alleviate the utility’s debt-servicing burden include selling off some of its power stations and debt-for-equity swaps with the likes of the Public Investment Corporation, manager of public sector workers’ pension and unemployment funds, but that these and other proposed solutions “have since emerged and faded”.
In Europe, for example, by 2020 only about 22% of annual power generation was renewable and supply was wildly variable: a record high of 30.1% on July 30 2017 was followed only three weeks later by a low of 5.5%. As a result, Europe’s baseload grid is still sustained overwhelmingly by fossil fuels, with nuclear providing a quarter of supply.