Eskom won’t ditch coal, delays decommissioning power stations

Chief executive Dan Marokane says coal is important for the country to drive industrialisation

Eskom chief executive Dan Marokane says coal will remain a critical component of the group’s energy security as it reaches the final stages of its energy blueprint, the Integrated Resource Plan, which was put out for comment early this year. 

Marokane was speaking at Standard Bank Group’s Unlocking Africa’s Growth business and commercial banking conference in Cape Town where he said there was space for renewables and coal. 

“We need not forget that this country requires a very stable base load for us to be able to drive industrialisation,” he said. 

Base load is the amount of energy that needs to be supplied at a specific time

This comes after Electricity and Energy Minister Kgosientsho Ramokgopa promised an ultra-aggressive renewable procurement strategy during a media briefing earlier this week.

Marokane said the state’s power stations are in different stages of their lives and that there are a number of stations that still have 10 to 15 years of life left in them. 

“Ours is to invest every little cent we have in understanding technologies that are going to allow us to run these stations longer and run them in a responsible manner. So we can have extended use of coal, given the significance of coal in our ecosystem,” Marokane said. 

South Africa’s coal reserves are estimated at 53 billion tonnes and, at the present production rate, that translates to almost 200 years of coal supply left, according to a 2021 Eskom report.

But Marokane noted that no new coal-fired power stations would be built. 

“It’s not on the table,” he said. 

Part of the panel was Peter Venn, chief executive of Seriti Green, a subsidiary of mining and energy company Seriti Resources, who said the business was concerned with the “just” part of the energy transition and that included preserving jobs in the coal industry. 

There was major concern about the carbon emissions coal produces contributing to climate change and the global movement away from fossil fuels at the expense of workers’ livelihoods.

“There are hundreds of thousands of jobs in Mpumalanga that would be lost if coal-fired power stations were closed,” Venn said. 

He said it was impossible for a renewables plant to absorb the jobs lost when a coal plant was shut down. 

“A thousand people in a coal mine versus 50 people operating a wind farm. It’s about working with all stakeholders to grow the economy. 

“It’s not renewables or coal, it’s renewables and coal,” Venn said.  

Eskom recently achieved more than 100 days without power cuts. Marokane said the utility’s energy constraints had left it stagnant in terms of growth in a rapidly transforming industry. 

“Load-shedding has kept the business inward-looking while everyone around Eskom was taking advantage of the changes that are taking place. Eskom is 101 years old and we need to think about how it will look in this ever-changing energy supply space,” Marokane said. 

He noted that the schedules for Grootvlei and Camden power stations to be fully decommissioned by 2025, and Hendrina by 2026, had been delayed. 

“While we delay the decommissioning of the coal-fired power stations to find a holistic solution we are also going to start with the construction of our own renewable portfolio,” Marokane said. 

Two years ago, Eskom decommissioned Komati power station, which had been operating since 1961, to repurpose it into a renewable energy hub. Komati has a capability of 1 000 megawatts. When it was shut down it was producing about 150MW, the Mail & Guardian reported. 

“There are a lot of opportunities for repurposing and repowering Komati but, when you look at it, these things needed to be done upfront to enable the transition. 

“Because the impact of shutting down the station goes beyond the power station’s perimeters, it is the community and the social fabric that is affected. It’s about the coal mining industry that is also affected. We live in a country where unemployment is too high,” Marokane said.  

The Eskom boss said the utility had decided to delay the shutdown of the power stations that were earmarked for decommission to no earlier than 2030. 

“There is no confusion around this. All of us are aligned that we should not repeat Komati. On the one hand, we have to solve issues of transition, on the other, you have to have a very responsible and calculated way of bringing society along,” Marokane said.