Medupi to be ready 'on time'

Johannesburg - Electricity supplier Eskom has said it is on schedule with the construction of the Medupi power station in Limpopo, but is facing a year's delay at the Kusile plant in Mpumalanga.

Speaking to Fin24.com after setting the the first boiler column at Medupi in Lephalale (Limpopo province) on Saturday, Eskom chief generation officer Brian Dames said with 10% of the work now done, Medupi was still on target for commissioning in 2012.

The boilers are supplied by Hitachi Power.

Johannes Musel, Hitachi Power Africa CEO, said the setting was the culmination of more than two years of groundwork wherein the design of the boiler plant had been performed and pressure parts, steel work and other components were manufactured and fabricated in various locations in Gauteng and Limpopo.

"Medupi will be built within budget and on time," said Dames. However, he admitted Medupi had nearly doubled in price since it was first mooted. "It was initially approved for R78bn. Now the total cost stands around R125bn."

Dames said about R25bn of the extra costs were allocated for improved efficiencies, while contingency issues added another R10bn. The boilers at Medupi will result in higher efficiency and better utilisation of natural resources, such as water and coal, and will have improved environmental performance.

"[The 4 800 mW] Medupi will be one of a few dry-cooled coal power stations [in the world], which will save water," said Dames. The cost of that technology came in at about R25bn.

The rest of the extra cost came as a result of movements in the commodities used for the construction, mainly steel. Dames said, however, Eskom had committed itself to saving R22bn a year from its existing operations.

The first of six generating units would be commissioned by 2012.

On the 4 800 MW Kusile project, Dames said it has always been a year behind Medupi due to the funding difficulties Eskom has faced. "The first commissioning of Kusile would now be in 2014," said Dames.

- Fin24.com