Eskom’s diesel bill hits R5.26 Billion

Guest: Matthew Cruise |Energy expert at IMPOWER

Africa Melane speaks to energy expert Matthew Cruise on why Eskom’s diesel costs have soared, whether the spend is justified, and what alternatives exist to ease pressure on the grid.

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Episode Transcript

Speaker 1 (00:00):
Rise and shine. It's a new day. It's early breakfast
with Africa Milani seven minutes night is to six o'clock.
Escom saying that it has spent five point two six
billion rand on fuel for its fleet of open cycle
gets turbines, generating about eight hun and ninety two gigoat's
per hour to keep the lights on so far this

(00:22):
financial year. This is higher than the amount of electricity
generated during the same period last year. Matthew Cruz, is
energy expert at Empower, joins us on the line. Now, Matthew,
why are we burning more gas this year than a
year ago?

Speaker 2 (00:36):
Good morning, Good morning learn how is your listeners? So
this is quite concerning to see because it is within
this financial year they've given this reportback that they spent
double the amounts of diesel that in the same period
last year. So that's from the first April until now
the line, so that's like roughly three and a half months.
They've already spent five billion rands, which is double what

(00:59):
they were spent last year. So partly what they've done
and it's a philosophy change in the way that they've
been firing their diesel. You'll remember twenty twenty three, there
were times when you'd have loasating in the evening but
not during the day. We'd have like Stags two at
night and then stage zero the day or Stage three
at the evening and then Stage one during the day.

(01:20):
And around May April twenty twenty four, they started changing
that approach and they started kind of firing diesel up
to say three LOA sheading for the whole day and
as then the breakdowns increase and we've had, unfortunately the
EAF not really growing about sixty percent even though it

(01:43):
was meant to be and it's almost given a toget
of having it about seventy percent by March this year,
it's been sitting at sixty percent or low. So they've
been firing diesel to make up for the shortfall that
the copaser sessions are not making. So just Monday last week,
we had for the whole day, say three being mitipicated

(02:04):
by diesel by firing the diesel serb on and that's
the day that would be then brought back. It's through
units station units, bringing one six hundred units onto the
of electricity onto the grid of megwats. So ESCON has
been on the limit of loa sheading and it's been
mitigating that with a whole bunch of diesel. And unfortunately

(02:25):
this is not sustainable.

Speaker 1 (02:27):
Because the headlines we've been reading, Matthew is that Unit
four of the Mudipi Power Station was successfully returned to
the service eight months ahead of its original schedule, adding
eight hundred megawats to the national grid. And we're going
we don't have to worry about load shedding at all.
It turns out we do.

Speaker 2 (02:47):
Yeah, yeah, So that's three stages of loaching that I
was mentioning that we mitigated. That was around two thy
seven hundred units of megwats of in literacy that was
being produced per hour from diesel. And now when you
look at Unit four, that's eight hundred megawats. So if
you're just minus two thy seven hundred from the eight
hundred that we've got now back on the grid, you's

(03:10):
saw left of one thousand, nine hundred megawats, that's deficit
that you still need to make up a diesel. So
at the moment, like right now, we're not currently firing
a whole bunch of diesel, but one week ago we're
firing a whole bunch three and now going forward. Unfortunately,
there's no big units coming back from any of the powerstations,
so the older power stations. It remains to be seen

(03:32):
how the breakdowns are looking, and I project that Unfortunately,
as time goes on, we have more and more breakdowns
from all the powerstations. So I still see that there
could be some potential lodding coming up in August stage
two to stage four.

Speaker 1 (03:46):
Logiting sure, definitely. Morgana who speaks on behalf of s COM,
has indicated that that sweet spot, if you like, for
us is thirteen thousand megawads of unplanned outages, so ESCOM
has capacity to mitigate against up to that amount right
the minute it goes above that, it obviously becomes quite

(04:07):
a challenge given the aggressive maintenance work that the Minister
has been heralding over the last eighteen months or so,
why are we still seeing such a high level of
unplanned outages in our fleet?

Speaker 2 (04:22):
No, so, as I mentioned, we were sitting actually above
that's fifteen thousand up to the second thresholder they provided
us of saying that if we go about fifteen thousand
big wats of unplaned osters, then we can expect to
see sage two loturing. So we were sitting there on
Monday last week. We were sitting above fifteen thousand biguatts unplanned.
And what's going on is the old coal power stations.

(04:44):
So the fleet overall, the fourteen Paser stations we have,
the average age is forty two years old and there
are only designs ready to be like functioning and running
for forty years. So we've done a fifteen year life
extension on all of our power stations except for the
new ones that they will receive it, and the five
oldest past sessions actually sitting at fifty five years. They're

(05:06):
at the end of life and they're kind of pushing
them past the end of life. And the problem with
that is that you have this equipment that's been designed
to last for so long because it's very hard working
equipment like the mills. It turns the coal and great
coal dust provised field dust. It's like a lot of
moving parts. A lot of wear and tear is happening.

(05:27):
The boilet itself, a lot of boiler tubek started creeping
up as tungs. That's why your pumps and your if you'll,
I mean you air forced draft fans, all these things
are very much big moving parts that degrade over time,
and unfortunately they all kind of start failing together at
around fifty five years and going forward. So we have

(05:49):
this old fleet that has like an old car, lots
of different problems that are happening in different places, and
then as the unit experience critical failure on one of
the parts, they shut down the units then permanently going
forward and they take the parts from that units that
are still okay and use them on the other units
in the power station. So that's what we saw at
Commoditi POWERstation of nine units, there's any one it was

(06:12):
still going when it was decommissioned. So they we're not
decommissioning our powerstations. They're still breaking down and unfortunately units
coming offline and as a result, now we have this
high unplanned capacity losses going on.

Speaker 1 (06:24):
Sure, and you're forecasting of stages of flad shedding in
the coming weeks. I do hope that it does not materialize.
Matthew for what I'll say, but thank you very much
for your time and insights as order as Matthew Cruise,
energy expert at Empower reflecting on why SCOM has been
burning as much diesel as they have particularly in the

(06:45):
last week or so,