Eskom denies chamber's claims of coal boycott

Eskom has denied claims from the Middelburg Chamber of Commerce and Industry that it is refusing to collect coal it procured, as well as the link between load shedding and coal shortages.

Procurement of coal has been a significant challenge for the power utility, which has lost millions through suppliers such as Tegeta. Eskom says the latter under-delivered on its commitment to supply Eskom coal power stations.

On Wednesday, the Witness reported that Anna Marth Ott, CEO of Middelburg Chamber of Commerce and Industry, told the regional paper there was no shortage of coal and that coal was "piling up" suppliers’ mines, "uncollected by the utility".

Eskom spokesperson Khulu Phasiwe told Fin24 claims that Eskom opted for load shedding over a coal shortage were either false, or the consequence of a big misunderstanding.

"One of the things that is wrong about this is the claim that we said the coal shortage is why we have load shedding.

"While we do have coal shortage, that is not a direct cause of our load shedding. Load shedding is happening because of technical challenges," said Phasiwe.

Phasiwe said the latest instances of load shedding occurred because 16 000MW became unavailable due to unplanned outages. He said there were more unplanned outages than planned outages.

'Can't buy coal just because we need it'

He dismissed claims that Eskom refused to buy coal from its suppliers, saying all supply of coal to Eskom must be checked for quality of the coal, competitive pricing, reliability of the supplier and procurement guidelines.

"They are not telling us who these people are that are sitting with coal that we apparently refused to buy.

"We only buy coal from suppliers that are in our database as a guideline. We can’t buy coal just because we need it. If we do that, we will wind up before a commission one day," Phasiwe said.

Phasiwe said many coal miners and coal suppliers provided coal to various customers, and that these markets often became saturated. When the markets become saturated, he added, demand falls and affects the business of these suppliers.

"Some people were initially planning to sell coal to China and India, but because the market is overcrowded, they are sitting with the coal and want to create an impression that we don’t want to buy their coal for whatever reason," he said.

Meanwhile, president of the Cape Chamber of Commerce and Industry Janine Myburgh said on Wednesday that Eskom’s main problems were the coal supply and the lack of maintenance on its generating plants.

"South Africa has huge reserves of coal, but the problem is that most of this coal is being transported by road at great cost and that problem will not go away quickly. Eskom has failed to develop the mines near the power stations, and to do so now will cost money that Eskom doesn’t have, and it will take years," said Myburgh.

Myburgh said a large part of the maintenance problems Eskom experienced stemmed from a loss of skills.

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