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Eskom Q&A
14/04/2008 14:00 - (SA)
Cape Town - It seems the power crisis will be with us for years to come. Eskom's General Manager for Demand-side Management, Andrew Etzinger, agreed to answer questions posed by News24 users.
We'll be returning to South Africa in May after more than two years abroad. Our house stood empty for most of this time. Obviously we used hardly any electricity during this period, so penalties on the basis of our recent consumption will be grossly unfair. How will Eskom address such concerns? Hanna
I agree that the determination of equitable quotas for households will be extremely complex and highly contentious. It may not even be practical due to various metering requirements. In view of this there is growing support for the introduction of conservation tariffs instead, which will mean that the more we use electricity, the more we pay (per unit of electricity used). Rather like the water tariffs that certain municipalities have. If a quota system is introduced at household level it will need to include an appeal mechanism to accommodate exceptional cases such as yours. The government is expected to make an announcement by June 2008 on how the electricity shortage will be managed into the future.
Being a pensioner my electricity consumption has always been very minimal -+ R350 pm as I save as much as I can. I cannot reduce consumption further or I might as well live without it. Does this mean I will still be penalised? Luiza
I feel very strongly about this issue. Consumers who have used less electricity than others for reasons of affordability or out of a sense of responsibility should not be penalised. Fortunately the government also supports this view and I am cautiously optimistic that any future electricity consumption policies will expressly accommodate pensioners, the poor and those householders who actively conserve electricity.
I have already changed all my light bulbs with energy savers. My refrigerators and swimming pool pump are on the minimum. I just cannot save any more. What now? And what do you mean by "consumers"? Must the municipalities save 10% as a whole and then impose penalties and saving measures or does it apply to the individual households? Ant
On the first issue, please see my response to Luiza. At the moment the 10% saving is measured at the municipal (bulk meter) level and Eskom will exclude any municipality which has reduced consumption by 10%, from load shedding. Unfortunately, in terms of your second question, if the whole municipal consumption does not reduce total consumption by 10% they will be subject to outages. How they then administer these is a local municipal matter.
In 2006 I was living alone with my daughter in a house. We left the house every day at around 06:30 in the morning and got home around 19:00 every evening five days a week. So for five days a week the electric usage was minimal since there was no one home. I have subsequently taken in two tenants. The two tenants do not work, so the house now has occupants all day long all week, so my electricity consumption has more than doubled since 2006 since there are more people living there and they are always people in the house. Penalising me if my usage doesn't drop by 10% based on 2006 info when there are twice as many people living at the premises at present is very unfair. Does Eskom have plans to make sure the calculation of the penalties are fair to all, or is it just tough luck for me? S Boucher
I understand your concern. Again, this is a difficult issue, which further illustrates the complexity of the task of electricity consumption penalties. Please see my response above to Hanna.
I would fully support a raise in tariffs if I knew the money would go to green energy - we already have a coal problem - why not tackle the issue correctly now, and become a leading green country to boot? I do not, however, wish my money to go to more coal / nuclear power. Richard
Most would agree with your sentiment, Richard. Unfortunately the cost of green energy solutions are generally not attractive when compared to conventional power station options and only a few people have indicated their willingness to pay the required extra costs at this stage. Having said this, we are supporting a number of "green" energy supply initiatives where it is prudent for us to do so. Examples include the solar hot water programme and the generation of electricity with wind turbines.
We have all been told that penalties will be introduced if consumers do not reduce their consumption. Some of us are already trying to save so the question how does Eskom intend to measure the saving? Already some people are pushing up their electricity demand so they can more easily institute savings when penalties are introduced. This in turn goes contrary to national savings efforts and could disadvantage those who are already switching off to reduce their power demands. Can you give the public more clarity on the penalty issue and how this will be measured and implemented? E Lourens
Yes unfortunately there are always those in society who will try and take advantage of circumstances. You raise an important matter. However the period for the determination of baseline consumption is currently set at October 2006 to September 2007. Any savings achieved now will therefore not penalise the consumer, so do continue saving where you can.
Excess demand
What is the current forced/unplanned outage rate at power stations and how does this compare with world standards? Aberdein
Our aspiration is to achieve a forced outage rate of 3% on a consistent basis but we are closer to 5% at the moment and the trend is not encouraging. Our forced outage performance is nevertheless currently at similar levels to the top "coal-fired" utilities around the world. Since we are faced in South Africa basically with a situation of excess demand over supply, which puts exceptional pressure on our generation resources, the challenge is going to be to maintain these levels until such time as we have new generation plant functioning.
Why is there so much disparity amongst where and for how long load shedding is taking place in different areas, eg I suffer 2.5 hours of load shedding 3 times a week (Stellenbosch area), whereas colleagues living in the Cape Town (southern suburbs) experience only 2 hours once a week? KJ
The 2.5 hours, three times per week outage pattern is the standard load shedding interval across the country. In this sense therefore you are not being penalised living in Stellenbosch. In terms of those customers living in the municipal area of Cape Town City Council I do not know the precise reason why some of their customers are experiencing fewer outages. A possible explanation may be that certain municipalities, such as the City of Cape Town, have a large and diverse customer base (industrial, commercial and so forth) enabling a more flexible outage regime. They also have pumped water peak electricity storage and these things may enable them to have some greater flexibility in the way they manage their outages. As you will gather, unless you are a direct Eskom customer, it will be your local municipal electricity supplier who will be managing the precise outage arrangements in their area of responsibility.
I have a solution that will alleviate the power shortages. How can I protect my solution if I want to sell the idea to Eskom without them stealing the idea? Louis
There are two ways. You can either take out a patent or sign a standard non-disclosure agreement with Eskom. I would suggest you contact Eskom's research department to get a copy of the agreement and to find out how the process works. We sign a number of non-disclosure agreements with entrepreneurs and inventors every year.
How many newly employed workers have the technical qualifications and ability to efficiently perform their specified duties? I am looking for a figure in percentages, if possible. I am aware of the claims that the power outages were due to coal shortages, malfunctioning components, etc. but for comparisons sake, I would like to know of the skills of recently employed workers. Thank you for your time. Michael
You raise a very important matter and thank you for asking this particular question.
Eskom is recruiting new staff at the rate of approximately 1 500 employees per year. The majority of these are qualified engineers and technicians appointed to work in one of the three divisions of Eskom, namely Generation, Transmission and Distribution. In addition to technical staff Eskom also regularly appoint qualified people operating in various other disciplines such as finance, human resources, procurement, project management, treasury and information technology.
Can the power generated by the ocean (in the form of waves) be used to assist the national grid as a form of sustainable energy? If so, how long will it take to put this onto the grid? If it is shorter than the anticipated time to build a power utility (and certainly cheaper and cleaner), is this considered as a serious alternative? Eileen
Yes, wave power and tidal power can be used to generate electricity although no large projects on a commercial scale are planned for South Africa at this stage. Much of the wave generation technology is still in the development stage from a large-scale commercial perspective. Eskom maintains a close watch on all possible electricity generation developments, particularly those that are environmentally and economically sustainable. Unfortunately many of these options, on closer inspection, are currently significantly more costly, produce relatively limited amounts of electricity and will take longer to bring on line than other renewable options such as wind powered generators and the substitution of electric geysers with solar hot water systems. As mentioned earlier, Eskom is currently actively working with the last two renewable energy supply options.
Why the useless subsidies on solar geysers? We are building a new house, and face it, the cost of a solar geyser just makes it too expensive. We will be doing it for Eskom not for ourselves, as the saving over the estimated 5 years just doesn't make it worth it financially for us to do it. So unless Eskom comes to the table and make it more cost effective, your whole initiative is a waste. The average South African cannot afford it! Marike
Eskom's solar water heating programme offers a subsidy of around 25% on the installed cost of a solar water heater. The subsidy amount is stipulated by our regulator so it is not possible to increase the level of financial subsidy. Given the likely electricity price increases and rising levels of inflation in South Africa, solar hot water system pay back periods are set to drastically shorten, making such systems more viable. As well as an assured supply of plentiful hot water at a fraction of the cost of an electric geyser hot water supply, such systems give huge environmental benefits with our very high periods of sunlight hours in South Africa. I have had solar water heating in my previous home and am installing a system at my new home. It is a remarkable technology and I strongly recommend going for it.
Regarding the penalties for users who do not reduce their consumption. How will the usage saving be determined for users with pre-paid electricity? Marius
There are a few technical options requiring changes to either the vending or metering systems but no decision has been taken thus far. In general, pre-paid customers have a lower amperage supply than other households and their consumption is therefore restricted to a significant degree already.
When will the correct schedules be on the site and when will they actually be followed? At the moment we have the schedules but they aren't been followed? SD
The new schedules are on our Eskom website. Eskom's schedules are being closely adhered to these days. In certain cases municipalities are having difficulties adhering to their schedules but the situation has improved dramatically over the past week. If you experience an outage outside of published times please notify your supplier (municipality or Eskom) so that we can correct the problem.
Since you are a public enterprise, kindly explain your reasoning behind the "Eskom Trade Secrets" with regards to the anticipated tariff structure. As your customer, why am I to be kept in the dark (excuse the pun) regarding factors that may have a significant impact on my budget? Jan
The "trade secrets" relate primarily to information regarding specific commercially confidential coal contracts which Eskom has negotiated or is presently negotiating. The issue in this regard is that Eskom's negotiating position will be weakened if all the facts and figures of contracts were made known to the coal suppliers with whom we are currently negotiating. A weaker negotiating position means higher coal prices and ultimately higher electricity prices. Having removed these specific contract details, the remaining information in the public domain is never the less fairly comprehensive.
Have you guys considered taking out the light bulbs of every second street light? Surely this would save a lot of electricity and not every single streetlight is needed in all areas! I am sure in some instances you could even only keep on every third light! F Hugo
We looked into this option fairly recently. Regulations stipulate that for safety reasons you cannot drop lighting levels below a certain minimum level. In practice a municipality could be sued if it could be proven that a motor accident resulted from lighting levels being too low.
Why is it necessary to purchase an EXTRA 45m tonnes of coal to replenish 20 days stock, while Eskom uses a TOTAL of 200m tonnes per annum? This 45m tonnes of coal translates to roughly 80 day's stock - a quarter of a year's supply - and way over 20 days worth of supplies. Chris
This is a good question. The 45 million tonnes is not only used to build up stockpiles. Eskom burns around 120 million tonnes per annum. A number of contracts for the supply of coal have lapsed or will be lapsing soon and need to be renegotiated. The coal flowing from the renegotiated contracts is included in the 45 million tonnes quoted. The issue here is that the price for this coal will be substantially higher than previously.
The following questions were put to Andrew by News24's editorial staff.
Reports from many News24 Users are that the predictive load shedding schedules aren't being stuck to at all. Surely the point was to stick to these schedules to reduce demand and to allow consumers to plan their work and home life around the power cuts?
On the whole there has been close adherence to the published schedules. Predictability of load shedding is a key requirement and we understand this. See the earlier reply to SD.
There is a lot of frustration towards Eskom right now, particularly due to the 53% price hike application and the predictive load shedding. Does Eskom appreciate how badly it's affecting consumers? Is Eskom not worried about what that kind of price hike will do to inflation? Is there really no other way for Eskom to raise the funds it needs?
Given the understandable anger towards Eskom due to the electricity shortage, the last thing we wanted to do is compound the problem with price hikes. There are three ways to fund Eskom - shareholder support, loans/bonds and revenue from the sale of electricity. We are currently drawing on each method to the extent possible but there unfortunately is still a gap.
Eskom's CEO Jacob Maroga has said the power shortage problems will be with us for years to come. As more newly built power stations come online, will the problems at the very least be alleviated? Also when is the projection for this to start happening?
The problem will begin to be alleviated when the rate of the electricity generation capacity increase exceeds the rate of demand increase. This will not occur before 2013 given the expected rate of demand growth and the time to build and commission new generation plant.
The City of Cape Town has published maps with time frames to help Capetonians decipher the load shedding schedules. Why doesn't Eskom publish maps on their website to cover the country as a whole?
Many thanks for this, a good point. I will look into it.
If municipalities do not stick to the load shedding targets set by Eskom, what will be your response?
Municipalities do comply with the overall load reduction requirements from Eskom's system operator. However a concern does arise in certain cases as to the approach used to achieve the load reduction. We urge municipalities to undertake load shedding according to the principles used by Eskom (predictability and fairness) to ensure a uniform approach nationally but unfortunately, often for reasons beyond Eskom's control, this does not always happen.
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