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WHO IS ESKOM

Eskom is South Africa’s controversial power utility, recently reappearing in the headlines in a negative light for the dreaded load shedding. But looking deeper, Eskom has a rich and rather complex background dating back to the early 20th century.

Eskom, Established by the Electricity Supply Commission in 1923, is the largest producer of electricity in South Africa. Producing in the region of 95% of all South Africa’s consumed electricity, Eskom also accounts for some 45% of the African continents’ power, giving Eskom the title of largest electricity producer in Africa. Furthermore, in terms of generation capacity, Eskom ranks in the top 7 worldwide.

With numerous power stations across the country, Eskom boasts various types of power stations including coal-fired, hydro-electric, nuclear, gas and even wind farms planned for the future. Providing power not only to commercial and residential customers, Eskom powers the majority of the industrial, mining and agricultural sectors of Africa’s leading economy, making it an indispensible utility for the African continent.

With the recent resignation of Eskom’s CEO, Jacob Maroga, the parastatal currently faces the overwhelming task of stabilizing the country’s power grid and bringing new power stations online while mustering its way through a severe backlog in maintenance. But can Eskom restore its tarnished reputation?

UPCOMING PROJECTS AND FUNDING

With more and more people moving to South Africa, there is an increasing demand that Eskom needs to fill. More people being born, more complexes being built, more open land being developed. With an ever increasing demand for electricity, Eskom, our primary provider, would need to employ measures to ensure continuity and that the growing demand is always met.

Eskom has a few planned power plants for the very near future, some of which are currently under construction. Medupi Coal Fired power station is a shining example of Eskom’s new projects. The cost of this delayed project is an estimated R170 billion and is already putting power into the national grid. Upon completion, Eskom’s newest coal fired power station is to become the largest in the world, pumping out an expected 4800Mw of power through six boilers, each powering an 800Mw turbine.

Another much smaller scale project is Eskom’s Ingula Pumped Storage Scheme. Consisting of two dams, this hydroelectric plant will give Eskom power by using water from its upper dam during the peak periods of the day. At night, however, excess power on the grid generated by other conventional methods will provide Eskom with the means to pump the water back up to the top dam.

With power stations running years behind schedule and load shedding looming over the country for the foreseeable future, we eagerly await to see whether Eskom will live up to their words… but don’t hold your breath. In the meantime though, we’ll keep looking at sources of alternative energy to keep the lights on.

ESKOM PRICE TARIFF INCREASES

Eskom has been in the spotlight for some years now, but not in a very positive light. The controversial power utility seems to be racking up a rather negative reputation with the repeated price tariff increases and no end in sight.

Eskom introduced drastic electricity tariff increases a few years ago known as the Multi-year Price Determination (MYPD). As granted by the National Energy Regulator South Africa (NERSA), Eskom would be allowed to increase their tariffs in stages, each year for three years. The most recent cycle, MYPD2 would end 31 March 2013. However in 2012, Eskom would submit an application for MYPD3, this time, spanning over 5 years. The revenue that would be requested in this application would amount to R1 trillion.

In recent news, Eskom has submitted an urgent application to NERSA to increase the electricity tariffs by 25.3% for the financial year 2015/2016, that, including the 12.69% that has already been granted. The utility has also requested the selective reopening of the MYPD 3 application from the 2015/2016 financial year. “This is due to costs incurred securing further short term power purchases and increased use of open cycle gas turbines” Eskom said.

Forcing many small businesses to close their doors due to Eskom’s soaring electricity costs, being hit with fuel hikes as well as a weakened currency, it’s no wonder that everybody has some form of alternative energy on their minds in order to save wherever they can.

ESKOM IN THE NEWS

Eskom, our current majority electricity service provider, appears to be attempting to restore the public’s faith and confidence in them by announcing that they are aiming to have a load shedding free week.

Almost every day, Eskom has implemented rolling blackouts labelled by the power giant as ‘load shedding’, which affects the lives of just about every citizen in South Africa. Ignore the millions in lost revenue it costs the country; it boils down to the simple inconveniences like being stuck in traffic because lights are out at every intersection during peak hours that really grinds the gears of ordinary citizens. But it does not end there, on Wednesday last week, President Jacob Zuma gave the dreary message to parliament that load shedding would continue for an estimated two to three more years.

In a small shimmer of hope, Eskom appears to have had some relief with the Medupi power station pumping in about 800Mw of power last week allowing the utility to keep lights on a little longer. “Our ambition is not to have load shedding in the first place”, said Eskom’s Khulu Pasiwe. With the additional capacity that the Medupi power plant is pumping in, June is expected to be a better month with a lower risk of load shedding.

But why does it appear to be a major accolade and goal reached to provide the public service that they are meant to? Are people merely complaining about Eskom and not doing anything constructive about it? Only time will tell whether Eskom keeps us out of the dark ages and delivers on what they promise.

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