Business

Eskom tries to dodge air controls

Analysis Lynley Donnelly

The utility is being accused of holding its customers and the authorities to ransom.

Jo’burg at night: Eskom says the Kriel power station cannot meet emissions standards. (Madelene Cronjé, M&G)

South Africa's electricity behemoth told the country this week that emissions from its Kriel power station will not meet the limits of a new atmospheric emissions licence granted for the plant.

Eskom is seeking a hastily put-together variation order to the limits set down in the licence or, it said, it risks having to cut Kriel's electricity output by as much as 2 400 megawatts out of a total of 3 000MW to meet the terms.

It comes at a time when South Africa's electricity reserves are already paper-thin and, as Eskom corporate services managing director Steve Lennon said this week, it "compounds" the risks Eskom already faces.

But industry experts and environmental groups have condemned Eskom for holding both customers and state authorities to ransom by essentially arguing that if it does not get a variation order it will cut power when the country can least afford it.

The case of Kriel is just a forerunner of a potentially much larger reckoning Eskom must face over emissions standards. The company is believed to be the largest carbon emitter in the country.

Nevertheless, Eskom has applied for postponements of the application of new minimum emissions standards for all its power plants, except Kusile.

Minimum standards
The minimum standards applying to old power plants takes effect in 2015 and to new plants in 2020.

Following the provisions of the National Environmental Manage­ment Air Quality Act that came into full effect in 2010, Eskom applied for a review of its emissions licences for several of its power stations, or essentially for a conversion of an old registration certificate to an atmospheric emissions licence.

According to Lennon, Eskom appealed against the stricter limits contained in the reviewed licences for the Matla, Duvha and Kriel power stations in mid-2012 but the appeal was unsuccessful.

In the case of Matla and Duvha, Eskom believed it could meet the licence limits, but it is unable to do so at Kriel within the limits of its design technology, hence the application for a variation order to the emissions licence.

But the decision regarding the appeal was handed down in June this year and Eskom waited until November 26 to apply for the order.

Eskom said the delay was the result of having to deal with regulations under the new Act that were as yet untested and legal processes were still being "discovered".

Environmentalists question Eskom
But environmentalists have questioned this. According to Robyn Hugo, an attorney for the Centre for Environmental Rights (CER), it is not clear why Eskom waited so long to apply for the variation order, given that it was well aware of the looming problems, or why it has only given interested parties eight days to respond to its application.

The CER is acting for a number of civil society organisations campaigning against Eskom's attempts to get out of meeting the minimum emissions standards, including groundWork and Earth Life Africa.

Eskom is holding the country "to ransom by manufacturing a crisis so that all are made to believe that we have no choice in this matter", Rico Euripidou, an environmental health campaigner for groundWork, said. "If Eskom had been proactive and acted when they should have, we would never be in this situation," he said.

According to groundWork, the air quality in the vicinity of the Kriel power station already does not comply with World Health Organisation (WHO) guidelines.

"Eskom is saying that keeping a stable electricity supply is simply more important than the health impacts on residents within the [Kriel] impact zone," Hugo said.

It is "unacceptable" that Eskom is holding the authorities to ransom because of its own delay, she said.

Concenrs
Similar concerns are emerging about Eskom's broader plans for the postponement of, or exemptions from, the coming minimum emissions standards for its power stations.

Under the air quality Act, prescribed minimum emissions standards are set for certain activities, such as electricity generation operations, for which atmospheric emissions licences must be obtained.

The list of activities took effect in early 2010 and Eskom has had years to prepare for compliance, Hugo said.

Noncompliance not only threatens human lives but also sets a negative precedent for other large industry, she said, as Sasol and Natref have also applied for postponement and exemption.

As the CER interprets Eskom's position, the utility is seeking postponements for longer than the allowed five years, which would have the same effect as an exemption.

Eskom's applications also have a negative impact on emissions licence applications by other businesses. Authorities have already told other applicants that the air is "saturated" and further licences cannot be granted, Hugo said.

Critics dispute Eskom's rationale
Lennon said the rationale for Eskom's applications was because it would cost Eskom more than R200-billion over the next 10 years to comply fully "with an attendant minimal impact on ambient air quality".

But critics dispute this. Euripidou said that ambient air quality in the Highveld area around Eskom's power stations is already compromised.

He warned of a looming public health crisis, which ultimately the state would have to pay for.

Expert opinion from retired chemical engineering professor Eugene Cairncross provided to the CER also suggested that there are major concerns about Eskom's modelling, which underestimated the impact of its stations' emissions.

But Lennon said that Eskom remained committed to WHO standards and it did not believe in the case of Kriel that air quality standards would be affected.

Eskom's desire to delay complying with these kinds of environmental protections will be a major test for the regulatory authorities, most notably for provincial and local authorities, as air quality regulation falls under their jurisdiction.

Suggestions of tension
There are already suggestions of tension between the environmental authorities and Eskom.

On Wednesday, the department of environmental affairs released a statement stating it wished to "clear the air" regarding Eskom's plans to reduce capacity to comply with legislative requirements.

It said, in effect, that neither Eskom nor any other operator could apply for exemptions from provisions of the Act, including atmospheric emissions licence requirements.

But it could apply for a postponement to the compliance timelines for a period of five years per postponement. Eskom has been "advised" to explore this "regulatory opportunity".

It also noted that Eskom actively participated in the drafting of the minimum emissions standards.

The department said that "there would be no preferential treatment to any member of the regulated community" and it "ensures that all decisions made are in line with its constitutional mandate to give effect to section 24(b) so as to enhance the quality of ambient air for the sake of securing an environment that is not harmful to the health and wellbeing of people".

Eskom should "be chastised" for its handling of Kriel, according to Chris Yelland, an Eskom pundit and managing director of EE publishers.

The company has known about this "for years", he said, but, because of the cost involved and the time required for retrofitting, they could not comply.

"They are essentially running a system that is too tight," he said.

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