Coal corruption is driving SA into the arms of green energy, says De Ruyter

Corruption and crime in Eskom’s coal supply chain plays a significant role in the unreliability of electricity supply from coal-fired power stations. In this way, “coal corruption” is one of the factors driving electricity users to renewable energy alternatives.

“Coal corruption is very deeply embedded [in Eskom’s supply chains], and it is highly problematic. It is causing us, I believe, to accelerate the move away from coal,” said Eskom CEO André de Ruyter.

Speaking on Thursday at McCloskey’s Southern Africa Coal Conference in Cape Town, De Ruyter said Eskom experiences “significant instances of coal theft”. Loads destined for Eskom are taken from a certified stockpile, but en route to a power station the delivery is diverted to a “black site” where the load is replaced by lowquality discarded coal.

“This has created havoc in our coal supply chain and also at power stations. But we are doing our utmost to turn this around,” De Ruyter said.

One of the technology providers that Eskom appointed to help curb this type of coal theft was approached, within three months of being appointed, by a person who offered a bribe in exchange for access to override some of these controls.

If coal-fired power is not reliable, De Ruyter said, people will make alternative plans.

SA is already seeing about 1GW of solar rooftop power added every year — a trend that is likely to accelerate due to the lack of reliability from Eskom’s coal-fired power supply.

The poor performance of the coal-fired fleet, which was running at an energy availability factor (EAF) of less than 50% in January, was one of the major contributors to the constant load-shedding SA has experienced since the start of 2023.

The government’s plan to end load-shedding relies heavily on restoring the EAF of Eskom’s entire generation fleet (now at about 58%) to 60% by the end of March, then to 65% by March 2024 and 70% a year later.

SHUTTING PLANTS

De Ruyter said there is no “anticoal agenda” at Eskom. “The narrative suggesting that Eskom is accelerating the shutdown of coal-fired power stations and shutting them down sooner than should be is not true.”

According to him Eskom is shutting down power stations at a slower pace than provided for in the Integrated Resource Plan (IRP) 2019. “If we had complied with IRP 2019 we would have shut the power stations down sooner, [but we haven’t] because we understand that we need to keep whatever capacity we have available.”

The IRP 2019 provided for Eskom to decommission 5,400MW of electricity from coal generation by 2022.

After the decommissioning of the 1,000MW Komati plant in 2022, Eskom’s plans are to shut down three more coal-fired power stations, with a combined capacity of about 4,700MW, over the next four to five years.

The shutting down of coal plants becomes necessary, De Ruyter said, when they become too old to run safely and efficiently. As was the case with Komati, the cost of running and maintaining old power plants becomes prohibitive to the point where the unit cost of electricity produced far exceeds the unit tariff that Eskom can charge.

The transition from coal-fired to renewable energy is a gradual one that will happen over many decades, he said.

“The important thing is that the transition is, in our view, inevitable and we need to adapt to that transition in a planned and orderly way.”