The Italian Job: A look at the international experts hired by Eskom

Italian energy giant Enel, which is set to send experts to SA to help fix Eskom, describes itself as “the largest private player in the African continent's renewable energy sector”.

Minister of Public Enterprises Pravin Gordhan made the announcement of external technical assistance in an emailed statement on Tuesday as part of his plans to fix the debt-laden power utility.

The Rome-headquartered multinational energy group will be send two or three power station engineers to South Africa soon.

Eskom has implemented five consecutive days of load shedding this week amid power unit breakdowns and maintenance problems.

Gordhan has blamed poor design and construction flaws at the massive coal-fired Medupi and Kusile’s power plants for the constrained supply, saying the two plants are generating less electricity than promised. 

Enel operates in 35 countries across 5 continents and in SA and Morocco in Africa, according to its website.  The energy company claims to have 73 million end users around the world. 

The multi-national firm is Europe’s largest utility company by market value. Its biggest shareholder is the Italian Ministry of Economy and Finance which owns 23.6% of the shares.

Enel’s windfalls

The energy giant is listed on the Borsa Italiana under Enel S.p.A. and is also listed on several other international stock markets.

While not listed in SA, Enel’s presence in the country dates back to 2011 when Enel Green Power South Africa (EGP RSA) first began operations. According to the company’s website, it already has a “significant presence in the local market” with several wind and solar projects.

Two solar plants operated by Enel in SA, Adams and Pulida, were awarded 20-year power supply agreements with Eskom in 2014, as part of the Renewable Energy Independent Power Producer Procurement Programme, or REIPPPP tender.

Pulida Energy was part of a merger with Thebe Renewable Energy, approved by the Competition Tribunal in March 2018. 

EGP RSA currently owns and operates three other solar plants in SA, Paleisheuwel, in the Western Cape with a capacity of 82.5 megawatts, Tom Burke in Limpopo (66 megawatts) and Upington in the Northern Cape (10 megawatts).

In the Eastern Cape the company operates the 88 megawatt Nojoli wind farm and is also building the 111 megawatt Gibson Bay wind facility.

Globally, Enel is focused on “clean energy” with almost half of its generation capacity containing zero carbon dioxide emissions. Enel plans to phase out coal-fired stations by 2030.

Agreements in SA, paving the way for the construction of 27 outstanding IPP projects, with a combined capacity of 2 300 MW, were signed in April 2018 after several delays.

In 2017/2018, Eskom spent R21.3bn on purchasing energy from IPPs with an average cost of 222c/kWh.

The Department of Public Enterprises and Eskom were unavailable for comment on the costs involved in hiring the international technical experts.

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