These charts show the Eskom crisis has been two decades in the making

Current sky-high breakdowns have their root in decisions taken in the early 2000s …
The utility desperately needs supply to be added to the grid by ‘the external market’ so it has the headroom to stabilise its coal fleet. Image: Dwayne Senior/Bloomberg

Eskom COO Jan Oberholzer says the root cause of the current crisis in the utility’s generation unit is a shortage of both system capacity and funding.

Speaking at the utility’s System Status and Outlook Briefing on Wednesday, he made the point that the seeds of this emergency were sown in the first decade of this millennium and the results began to be seen from 2012.

Using benchmarks from German energy association VGB Energy that show comparable performance of coal fleets globally, Oberholzer explained how this has led to the recent exceptionally poor performance of the coal fleet.

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First, there is the widely known delay in commissioning new capacity

Government’s 1998 white paper stated that an investment decision to build new power plants was needed by no later than 1999. A decision was eventually made in 2007, and this delay was exacerbated by delays in commissioning of both the Medupi and Kusile power stations.

Completion of the first two units of Medupi was expected in 2012. The plant’s six units eventually achieved commercial operation in July 2021 (the following month Unit 4 exploded in an accident).

Kusile was originally expected to take six years to complete; its completion date was later revised to 2021. Eskom now expects full commercial operation by no later than May 2024 (although it appears – unofficially – that the remaining three units are all expected to be running by next year).

Oberholzer says Eskom’s plant availability, or energy availability factor (EAF), was in line with or better than its peers until 2012 (you’ll soon see why).

Source: Eskom

Importantly, the trend of reducing the EAF, or the percentage of capacity that is available, has trended down globally over the last two decades.

It has declined from an average of around 90% to the 80% level. In Eskom’s case, it has plummeted to 60% (its coal fleet achieved an EAF of 55.5% in its 2022 financial year to March 31).

For the last two decades, Eskom has been doing less planned maintenance than its peers, despite an ageing fleet of power stations.

Global peers are now ensuring that an average of 10% of their fleets are offline for planned maintenance. In recent years, Eskom seems to have finally caught up.

The level for calendar 2021 was 10.81%. So far this year, it has managed 12% although this will drop because of the winter months where maintenance is cut back almost completely.

Source: Eskom

Oberholzer maintains that there has been insufficient generating capacity since 2002, and in response Eskom created “virtual capacity” by running its coal units harder than its peers. This has been the case for the past 20 years.

The chart below shows the energy utilisation factor (EUF), which measures ‘how hard’ units are being run.

Source: Eskom

The utility says that “from 2003, Eskom’s median stations were running at similar or higher EUF than VGB’s best quartile, and since 2012 Eskom’s lowest quartile [worst performing] stations have been running at higher EUF than VGB’s best quartile [best performing]”.

Systems ‘operate at their limits’

It says “high utilisation means plant systems are required to operate at their limits, leading to strain, increased wear-and-tear, decreasing plant reliability and requirement for increased maintenance”.

So the even higher utilisation led to less time available for maintenance, even though more maintenance was required simply due to the plants being run this hard.

The result of this is plant breakdowns.

Eskom says its plants’ unplanned energy loss factor (the amount of capacity lost to breakdowns) was “in line with or better than peers up to 2011” after which the impact of an artificially high energy availability factor and the decisions to run plants too hard over the prior decade began to take their toll.

It makes the point that there are “many influencing factors” but that the “main root cause is consistently running at high utilisation over many years”.

Breakdowns have been running at between ±15 000MW and ±18 000MW for the last week.

Source: Eskom

Eskom asserts that this cycle can only be broken with adequate funds and the space in which to perform the maintenance required. Both of these remain a problem.

Eskom currently relies on annual bailouts from government to service its mammoth debt pile (technically, the interest on this).

And the utility desperately needs between 4 000MW and 6 000MW of supply to be added to the grid by “the external market” so it has the headroom to get its coal fleet back to some semblance of stability.

It impressed on government the urgency of this as far back as December 2019.

The idea that its EAF will ever return to 75% – which government’s most recent Integrated Resource Plan (2019) assumes – is fanciful.

But EAF of 70% or even 65% will make a big difference over the next few years, even if many of Eskom’s older coal power stations will be decommissioned by 2030.

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In other words, these charts show that we have an ANC problem.

” It impressed on government the urgency of this as far back as December 2019. ”

Viva All Not Competent ” Amandla !!!!!

The incompetence, negligence, and criminality of ANC leaders drive the process of decay at Eskom, SOEs, and municipalities. The wheels are coming off. The disintegration of the Sate is the logical consequence of the collapse of accountability within the ANC. Even at this late stage, with evidence abound, ANC supporters still do not accept responsibility for the destructive way in which they express their mindsets.

The ANC is like a farm without an owner. The farmworker factions are fighting each other to plunder the resources. They forgot to plant the new crop. They are consuming the seed and the breeding stock. They are selling the fencing and farm equipment to buy beer. The farm is falling apart because the only accountable person, the owner, has been overthrown by the workers. None of the workers are accountable. They are competing in a race to the bottom.

There is no difference in outcome between emerging farmers and emerging politicians. Both have a 100% failure rate because they operate for the wrong reasons. Their motivation is counterproductive. The ANC ethos motivates short-term overconsumption and punishes long-term productivity. This is how a nation goes bankrupt.

The inevitable progression of African countries post their “liberation”

Criminality, Corruption, Joblessness, Poverty, Crumbling infrastructure, No water, No power, No food !!!!

You are describing animal farm!

Bottom line:

1. Same with your car, if you do not follow OEM specification for service intervals etc, its going to leave you stranded next to the road.
2. Even if Eskom has caught up with regards to doing more planned maintenance, I seriously doubt that the quality is in line with the international peers as most experienced personnel already left Eskom years ago and left a massive gap…

There is no Funding problem at Eskom – there is however a problem with the effective utilization of funds. Their wage bill that keeps expanding, while producing less energy and less maintenance is the elephant in the room no-one is willing to address. The other problem with effective use of current funding is that they still have not stopped corrupt employees from draining finances. Again not a topic they want to address. From the public’s perspective we are losing how much from the economy with businesses losing operating hours and this in turn reduces taxes collected and places additional strain on workers and business owners as they pay additional taxes and get no return for that. Time to shut the door on this disaster and outsource the entire opperation to business and private individuals – like the ANC, Eskom does not have the ability to self correct and we will be sitting with this headache for ever.

Everything Mr Oberholzer said is correct & is well known in the industry. Nothing that is happening is a surprise to anyone with any knowledge of, or experience in, power generation!

End of comments.

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