Politics of power ignores reality

By 2030, South Africa’s new coal-powered stations Medupi and Kusile will be online and several nuclear power stations will feed into the grid. The country will have enough power and parents will tell their children stories about how they were conceived during something called “load shedding”.

During the 2008 energy crisis, the department of energy commissioned a plan for the next 20 years that would ensure the country had enough power. The document, called the Integrated Resource Plan (IRP) 2010, was written at a time of crisis and called for a doubling of the national grid to 85 000MW. The plan was also based on ambitious economic growth rates.

The 2010 IRP plan for 2030 envisaged that half of the 85 000MW would come from coal-fired power stations, with a mix of old plants and 9 600MW from Medupi and Kusile. The rest would come from a mix of renewable energy sources, hydroelectricity and nuclear. The new nuclear component would be 9 600MW, which would be added to Koeberg’s 1 800MW.

Eskom said in response to queries from the environment department last year about the longevity of its fleet that it would extend Koeberg’s life to mid-2040. Its coal-fired power stations have similar lifespans.

The 2010 IRP plan, which is supposed to be updated every two years, was revised in 2013. Using current data, planners lowered the future energy demand projections. The country would need 6 600MW less generating capacity, according to the 2013 IRP update.

But even this reduction was based on an economic growth target of 5.4% a year. The World Bank said last year that South Africa would grow at about 2% for the near future.

‘Risk of overbuilding’
The update warned: “The reality is that demand may not reach the levels required, which raises the risk of overbuilding generation capacity to meet the target.” The IRP’s main recommendation was that the decision to build a nuclear fleet be delayed until 2025 because renewable energy sources and coal would provide sufficient power.

Last year, Eskom said it was not using the 2013 IRP update for its projections because the Cabinet had not signed off on it.

But at the end of 2014 Energy Minister Tina Joemat-Pettersson signed memorandums of understanding with nuclear vendors, such as Russia and China, to build plants that could generate 9 600MW.

In effect, the government is now basing its long-term energy decisions on information – the 2010 plan – that it knows is outdated.

The 2010 IRP did not put a limit on the unit price of nuclear energy. The update, however, did, by creating a price ceiling of $6 500 per kilowatt of capacity. It said that if the cost was above this then nuclear could no longer be considered a viable option. With no formal bids having being made, it is not clear what the cost would be for a South African build. But Hinkley Point in the United Kingdom is costing $8 150 per kilowatt of capacity. The newest Russian-built reactor is costing about $7 000 per kilowatt of capacity.

Johannesburg-based energy consultant Richard Worthington said there were several reasons the updated IRP was being “ignored or actively undermined at the highest political levels”. It could be to cement a relationship with Russia, or a response to Numsa’s move away from the tripartite alliance by undermining its power base. The decision could also be about reasserting the authority of the Presidency, by showing it had control over all energy decisions. It also continued South Africa’s tradition of centralising energy, and therefore concentrating wealth and power, he said.

The department of energy did not respond to queries by the time of publication. But its acting director general, Dr Wolsey Barnard, said last year that planning was being done on the basis of the 2010 IRP and the Integrated Energy Plan and nuclear were a certainty. He also said the plants would not be built by Eskom because of its financial problems.

A catalogue of missed chances

•?A broken fleet: Eskom’s current fleet is 90% coal-fired and many of its stations are approaching retirement age. They have been damaged by continual use over the past few years. Outages happen because of physical failures at plants. The replacement plants have doubled in cost and are five years behind schedule.

•?Eskom’s monopoly: Several attempts to promulgate the Independent System and Market Operator Bill have failed. This would bring the transmission grid under another entity, allowing private operators to use it. Eskom says it cannot connect renewable energy projects because it cannot afford to. This means usable electricity is being wasted.

•?People’s power denied: South Africa has a strictly controlled regime of who can sell power. This is denying people with money the opportunity to become producers. The model has worked elsewhere, with countries such as Germany getting up to 40% of their supply from solar panels on people’s roofs.

•?Poor planning: The 2010 IRP was supposed to be updated every two years, to ensure new economic data would inform decisions. This has not happened, and the 2013 update has not been signed off by the Cabinet. Decisions that tie up hundreds of billions of rands are being based on information that is five years old.

•?Poor leadership: South Africa has vast energy resources. It has abundant coal, reactant for nuclear power stations, limitless solar energy and it is surrounded by ocean currents. That these have not been turned into energy security is down to Eskom being ignored by the government in the past, and the continual crisis in its leadership. – Sipho Kings

Frack it, says the state

Natural gas is a common source of energy in developed countries. It warms homes and cooks meals. Stored underground, it is geologically newer than oil and has not been compressed into a liquid. The technology to use it has been around for decades.

But dwindling reserves threatened to kill off gas in favour of renewable energy sources, until companies managed to work out how to get gas out of shale deposits. This requires drilling down and then horizontally, in a process called horizontal fracturing (fracking). The technique’s success has opened up what are thought to be vast deposits of shale gas under the Karoo to exploitation. The government sees shale gas as a game changer because it would allow South Africa to become energy independent and save on the foreign exchange used to import oil.

The National Development Plan and IRP 2010 say it must be exploited. Gas-fired power stations would replace coal ones. Gas could also be transformed into liquid fuel, a process Sasol already does with gas from fields in Mozambique. The environment department says this would produce 50% fewer greenhouse gas emissions than coal. – Sipho Kings

IRP 2010 vs IRP 2013 update

Coal: 41 000MW – 38 700MW

Nuclear: 11 000MW – 6 600MW

Concentrated solar power: 600MW – 3 300MW

Wind: 11 800MW – 4 400MW

Hydro and pumped storage: 5 500MW – 7 300MW

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Sipho Kings
Sipho is the Mail & Guardian's News Editor. He also does investigative environment journalism.

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