Massive overspend by Eskom on diesel budget

Massive overspend by Eskom on diesel budget

By Jack Ward, MD of Powermode

 

Eskom spent a whopping R10 billion on diesel last year to help keep the lights on. This was substantially more than the R2bn it had budgeted for. The reason for this reckless spending? The electricity reserves are so tight, that the power utility had little option but to run the country’s diesel-guzzling ‘peaker plants’ for much longer than normal.

These peaker plants – open cycle gas turbines - usually supplement electricity supply only when demand spikes, usually in the early mornings and evenings. But Eskom used them extensively last year while the ‘generation fleet’ underwent critical maintenance.

What’s more, Eskom expects to run these peaker plants over-budget again this year. Let’s bear in mind that diesel is the most expensive form of power generation.

It’s a pity that Eskom, and its government supporters, did not spare a thought for the most inexpensive form of power generation and how it might help to boost the national grid.

I’m talking about rooftop solar photovoltaic (PV) systems and their potential, if implemented on a grand scale by single-phase electricity users – small and medium sized businesses and households - to generate many thousands of megawatts of new, clean power and so assist Eskom in its quest to keep the lights on and costs down.

If those decision-makers who will now be forced to pay the R10bn diesel bill had the foresight to use just a fraction of this cost to encourage the installation of low-voltage, grid-tied solar PV systems through a Feed in Tariff (FIT) or other rebate incentives (which could even be temporary) they would not be in the same position again in 2014/15.

What’s more, by encouraging small-scale solar PV adoption, they would help to create thousands of new jobs, establish many new small businesses and upskill hundreds of technicians on a long-term, sustainable basis.

I acknowledge that solar PV power is not prime energy source, but to ignore it completely is out of step with the emphasis being placed by Eskom on solar water heaters and efficient lighting programmes.

This short-sighted approach also ignores the strides that have been made overseas in solar PV implementation and the many innovations that are in the pipe-line relating to this technology.

I’m on record as saying that there could be an immediate market for as many as 100,000 new rooftop solar PV installations in SA. Sales of this many systems could well help create as many as 1000 new small-scale businesses and many thousands of new jobs in the near term.

Solar PV uptake will also help offset Eskom’s unnecessarily bloated diesel bill which at the end of the day will probably be paid by taxpayers via the treasury. All it needs is a small incentive to make the solar PV technology viable for end-users, many of whom already appreciate its ‘green’ credentials and are enthusiastic supporters.

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