Future priorities of Eskom

Five step change focus areas for 2012/13

Eskom will focus on five areas for the financial year 2012/13, where step changes are required to create a solid platform to shift performance and grow sustainably.

The priorities for the next year are detailed below:
  • Safety
    Eskom is committed to safety, however, fatalities and incidents continue to occur. An Eskom principle is that “No operating condition, or urgency of service, justifies exposing anyone to negative risks arising out of Eskom’s business or cause”. When reassessing our past efforts, it has become clear that Eskom must establish a safety culture that is driven by leadership and individual behaviour by moving from a supervision-driven culture to a self-driven culture.

  • Keeping the lights on with focus on:
    Ensuring security of supply
    Eskom is currently managing a tight power system, which will continue for the next five years and especially for the next two years, while new capacity is built. The electricity supply/demand balance will remain tight until both the Medupi and Kusile power plants begin operating.

    To minimise the possibility of load shedding, various initiatives including signing up short-term generation options, enhancing generation performance, improving coal quality, giving independent power producers (IPPs) access to the transmission grid, responding dynamically to changing demand, and intensifying communication to promote efficient energy use. Increasing use of open cycle gas turbines, identifying demand response options in smaller customers and establishing an Energy Conservation Scheme will create an electricity “safety net”.

    Deferring maintenance is no longer an option to manage supply and demand. The maintenance programme must be implemented, which requires other supply and demand levers. The strategy to achieve this has been submitted to the Department of Public Enterprises (DPE) as a Public Finance Management Act (PFMA) application.

    Ensuring demand-side savings by both Eskom customers and Eskom owned facilities
    While it will take substantial effort from many stakeholders to overcome the current electricity challenges, security of supply can be ensured as long as all the key stakeholders, including the people of South Africa, partner with Eskom to overcome all the obstacles to implementing the identified initiatives on the supply and demand side: Accelerated Solar Water Heating, Accelerated Demand Response, The Energy Conservation Scheme (ECS), Innovative IDM Solutions, Mass Rollout Programmes, Residential Mass Rollout Programme, etc.

  • Ensure financial sustainability:
    The focus on the Multi-Year Price Determination 3 application will be a high priority.

  • Delivery on the capacity expansion programme
    There is a renewed focus on delivering on capacity expansion projects; on time, within budget and at the right quality. There has been a delay with the commissioning of Unit 6 of Medupi, but the appropriate measures have been implemented to ensure that all the other generation units will be commissioned on time.

Commissioning schedule

Project   Actual  
  Grootvlei (return to service)   160   30               190    
  Komati (return to service)   325   200               525    
  Camden (return to service)   20   30               50    
  Arnot capacity upgrade (coal-fired)   30                 30    
  Medupi (coal-fired)       794   794   1 588   794   794     4 764    
  Kusile (coal-fired)         800   800   800   800   1 600   4 800    
  Ingula (pumped storage)         1 332           1 332    
  Sere wind farm (renewable)       100             100    
  Total (MWs)   535   260   894   2 926   2 388   1 594   1 594   1 600   11 791    

The capacity expansion programme has turned Eskom into the country’s largest EPCM company. Current key projects are Medupi and Kusile, with 4 764MW and 4 800MW of generation capacity installed, respectively.

Eskom is also upgrading the grid to 765kV lines and the new construction will cover over 1 800 km of power supply lines. Other projects will add a further 2 300km of power supply lines and 20 600MVA of new transformers.

Distribution is making an effort to provide all South Africans with access to electricity. While connections of new customers amount to R16.4 billion, the refurbishment and strengthening of existing lines require investments of R14.5 billion and R26.6 billion, respectively over the next five years. Other distribution projects amount to R10.5 billion over the same period.

  • Improve operations: with focus on the continuation of the implementation of the Back2Basics programme (Processes, Systems and Tools) and implementation of the Generation (Reducing our unplanned capability load factor (UCLF) and ensuring the reliability of our power stations), Distribution and Customer Centricity Excellence Programmes.




Eskom Holdings SOC Limited Integrated Report 2012