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Midrand - Kusile power station - which will be completed in 2012 - is not the right offering for independent power producers (IPPs), a former Eskom manager said on Friday.
He was speaking at the final day of public hearings held by the
National Energy Regulator of SA (Nersa) on Eskom's proposed tariff hike of 35% every year for three years.
"Kusile is too far in the future to make investment attractive
for IPPs," Michael Deeds, a former senior general manager at Eskom said.
Instead, he recommended that power stations like Lethabo be open to private equity.
"With IPPs, bait needs to be offered -- hot bait that will make
them come in now," Deeds added.
Turing to fuel procurement, Deeds said that present coal costs
were "crazy".
"Clearly Eskom's fuel procurement division has to be fixed up,
but this will be one hell of a job," he said.
He also referred to consultant Susan Olsen's 2007 report on
Eskom's coal procurement which had been leaked to the press.
In the document, Olsen dealt with irregularities in the supply
of coal to Eskom.
"The report was handed to Eskom's then-CEO - I don't know what
he did with it and I don't know what Eskom is doing about this
report," Deeds said.
"I have no doubt that the coal procurement at Eskom can be fixed - but not overnight," he added.
Turning to the road haulage of coal, Deeds said it was unwise
for Eskom to be involved in the business of road repairs.
"Coal should rather be transported by conveyor belts or by rail
in a way that is cost effective."
Deeds also said that repairs to coal trucks were expensive.
"However, I see that Eskom has put in a rail system for Camden
power station and this is a step in the right direction."
- Sapa