Eskom say meeting pollution limits would cost R300bn

And boost electricity costs.
Image: Bloomberg

Eskom, the world’s biggest emitter of the pollutant sulfur dioxide, said retrofitting about half of its coal-fired plants with pollution cutting equipment would cost more than R300 billion and boost electricity costs.

The state-owned South African utility said it has applied for an exemption from complying with national emission limits for its power plants that are scheduled to close by 2030 and asked for a higher limit for six of its stations that will operate beyond 2030. Of its two newest plants, so-called flue-gas desulfurisation equipment has been installed at Kusile and will be retrofitted at Medupi.

“Eskom’s power stations with the exception of Medupi and Kusile were built at a time where there was no legal requirement for the installation of sulfur dioxide reduction technologies,” the Johannesburg-based company said in a response to queries Wednesday.

Read: Eskom now world’s biggest sulfur dioxide emitter: CREA

Eskom was this week named by the Centre for Research on Energy and Clean Air, or CREA, as the world’s biggest producer of the pollutant linked to ailments ranging from asthma to heart attacks. While South Africa cut the permissible amount of emission of sulfur dioxide to 1 000 milligrams per normal cubic meter from 3,500 milligrams last year, that limit is a multiple of that enforced in other major coal producers such as India and China.

Positive, negative

“The implementation of flue-gas desulfurisation at the stations operating post-2030 should be considered in terms of return on investment and balancing the positive and negative impacts on the environment and communities exposed to pollution,” Eskom said.

If the technology, the only one currently available to reduce emission of the pollutant to current emission limits, is retrofitted to the six plants that will operate post 2030 it will boost annual costs by R5.9 billion, necessitating a 7% to 10% rise in electricity prices, Eskom said. It will also increase the company’s water consumption by 59 million cubic meters a year and produce an additional 9.7 million tons of waste, it said.

Still, other major emitters of sulfur dioxide — China, India, the US and the European Union — have slashed emissions by closing coal-fired plants in recent years or fitting them with the equipment.

While Eskom produced 1 600 kilotons of the pollutant in 2019, all of the power plants in China now produce just 780 kilotons a year, down from 13 000 kilotons in 2006.

Eskom has disputed a study that ties its emissions to more than 2 000 deaths a year, though it said in 2019 that its pollution kills 320 people annually.

The utility, which has about 40 000 megawatts of installed coal-fired capacity, is more than R400 billion in debt.

© 2021 Bloomberg


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We need to move Eskom debt to central government along with the R35b interest.

Remember that government in any event warrants Eskom debt – except at higher coupon rate than its own debt???

We are trying to design tariffs around a cost structure that has 250% debt:equity ratio whereas US utility average is 15% debt:equity (and their interest rate is negligible). Interest is 15% of Eskom cost.

Consumers serviced by a council now pay an effective rate of $0.20/kWh or California’s peak rate.

Costs cannot continue increasing without the consequence that people help themselves. I am two increases from being able to run a 1MW factory cheaper with my own solar and diesel than Eskom can run its 40,000MW of coal and nuclear. Within five years my energy cost will be half that of the grid. That is a disgrace and makes a mockery of Eskom’s claims about how cheap SA energy is.

yea this talk of pollution reduction is madness when we can’t even keep the lights on. The loss of human quality of life due to no electricity (or expensive electricity if the green climate terrorists have their way) far outweighs the environmental and social costs of pollution.

Mr de Ruyter said they would rather spend this on introducing new capacity based on renewable energy. Also apparently the EU can give soft loans if they shut some of the older plants down.

End of comments.




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