Eskom loses power monopoly

Johannesburg - The government opened the door for independent power producers by announcing the National Integrated Resource Plan on Thursday, scotching Eskom's plans to stall construction of the Kusile power station.

The Department of Energy is drawing up the regulations that Eskom and the National Energy Regulator (Nersa) must follow.

Energy Minister Dipuo Peters says the department is also creating a new entity, the Independent System Operator (ISO), which will not reside within Eskom.

She explained that the ISO will be responsible for matters such as purchasing electricity from independent power producers, and will make it possible effectively to exploit the potential of independent producers. This new entity can be up and running within three months and will mean that Eskom no longer acts as both player and referee in the local power environment.

According to Peters, the resource plan provides for up to 1 020MW of power from the private sector in 2011.

Provision has also been made for 1 145MW of power to come from renewable energy projects in the private sector by 2012. This stipulation in the resource plan means that contracts for this source of electricity can now be awarded.

The policy document announced on Thursday presents Eskom with major challenges, and pulls the rug from under its recent tariff application.

The resource plan calls, for instance, for the utility not to delay the Kusile power station, which must still deliver its first electricity to the national grid by 2013. Eskom had wanted to defer construction of the power station to save money.

Peters said that Eskom and its shareholder would together have to work out where to source the funding. Planning could not stop just because of a lack of money.

The plan has to be drawn up, and the money then found. Security of electricity is non-negotiable.

- Sake24.com

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