Preliminary View of the Draft Integrated Resource Plan (IRP) 2023
Dr Titus Mathe (SANEDI CEO)
Context
South Africa has experienced severe loadshedding (i.e. controlled/scheduled power cuts), almost daily, since September 2022. This recent spike and high frequency of loadshedding can be largely attributed to a significant drop in Energy Availability Factor of the coal fleet that has not been optimally maintained due to several factors. In addition, shutting down of units at Koeberg for life extension, and the challenges experienced at Kusile when the entire power station had to shut down, contributed significantly to higher levels and frequency of loadshedding. The periods 2022 and 2023 were the worst years in terms of higher stages and frequency of loadshedding in the history of Eskom.
Loadshedding has reportedly cost the South African economy approximately ZAR225 billion from 2020 Q1 to 2023 Q1 (source: Codera Analytics, 2023, ‘Estimates of the cost of load shedding in SA’, 13 January 2024). Arguably, the cost of this loss to the economy will give rise to a positive return for any investment option available (e.g. renewal/upgrade of existing coal power plants, new nuclear build, new cleaner coal technologies, new gas to power, new solar to power, new wind to power, energy storage facilities as well as energy efficiency and demand side management initiatives) to eliminate loadshedding.
Consequently, it is believed that it will take several years, perhaps decades, for South Africa to recover economically from the dire consequences of this excessive load shedding. Some of the negative impacts of load shedding include:
- Disruption of essential services
- Disruption of business activities
- Aggravation of socio-economic inequalities
- Shutting down of small businesses due to the high cost of alternative energy sources such as solar energy, diesel and petrol generators
- Disruption of educational institutions
- Stifling economic growth which adds to the high unemployment rate and higher cost of living
By the same token, South Africa aims to achieve net-zero carbon emissions by 2050. Africa’s contribution towards global greenhouse gas emissions continues to be minimal, at 3.9% as of 2021, with approximately 1% contribution coming from South Africa (source: www.statista.com/statistics)