Tsotsi's quick fix plan for Eskom surfaces | Fin24
 
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Tsotsi's quick fix plan for Eskom surfaces

Apr 12 2015 14:37
Susan Comrie and Dewald van Rensburg

Johannesburg - Deposed Eskom chairperson, Zola Tsotsi, wanted to appoint private power producers without regard for Eskom's internal processes and interests.

In a letter to Tina Joemat-Pettersson, he asked her permission to "immediately" implement three plans so that three different producers could be be added to the network.

The letter was written on February 10 and encourages Joemat-Pettersson to expedite the three different contracts with three specified private power producers. In all three cases Tsotsi made it clear that he had already decided on the electricity suppliers.

All three plans at face value seemed unlikely or even impossible. Eskom would not officially comment on it, but an executive who chose to remain anonymous, said the letter is just another example of how Tsotsi acted without consultation.

According to the official, he often acted beyond his mandate as non-executive chairperson by promoting the interests of outside organizations.

Old plant should be reopened

In the February 10 letter Tsotsi suggests that the Ingagane power plant near Newcastle, which was shut-down 20 years ago, should be reopened.

Five years ago it was suggested that Ingagane, which had the potential to generate 500MW, should be sold to a private consortium at a cost of $2.5bn, be restored, and go back into operation.

Several indications suggested that the plan failed to take off. Rapport's sister newspaper, The Witness, visited the power station in January. At that stage, workers were using cranes to strip the power plant for scrap metal and parts.

Tsotsi, clearly unaware, said in his letter to Joemat-Pettersson that "we believe the project should be promoted". According to Tsotsi, a contract for the preferred bidder in 2010, the Southern Africa Power Consortium, should be closed.

In response to inquiries Eskom said that it is not currently considering to bring the power plant back in operation.

Co-generation

Tsotsi also supported an ambitious proposal for a company called Phambili Mzantsi Limited, "to provide 1 000MW to Eskom within a period of a few months."

According to his letter Phambili represents a group of co-generators. Phambili had designed a plan to collect electricity from different co-generators and to deliver to the national network.

"Eskom is keen to involve this group pending authorisation from the minister," wrote Tsotsi. According to him it was a viable supply initiative. However Rapport could not trace the company.

Sisa Njikelana, chairperson of the South African Independent Power Producers Association (Saippa) also says he has never heard of Phambili. He also believes it's unlikely that co-generators could supply 1 000MW within a few months.

It is estimated that the country can generate significantly more power from co-generation, but there are many regulatory issues that still need to be resolved, he said.

"It can be done by a group of companies. You will, however, have to be about half the size of Eskom or even as large as Eskom. You cannot leave such a massive task up to unknown operations," said Njikelana.

1 000MW of electricity is already being purchased from co-generators. It is generated by large industrial companies which produce heat and gases as by-products which is then used to generate electricity. Eskom says it has no need for a collector for co-generators.

Power from cargo ships

Tsotsi also wanted to purchase power "really fast and practically" from overseas power stations including a Turkish company, Karadeniz. The letter was written a week after reports about Karadeniz's services appeared in some South African newspapers.

Karadeniz operates power plants on large cargo ships. Eskom made use of the company in 2006 while Koeberg pwer station was down.

In the letter Tsotsi was excited about Karadeniz. The company apparently offered a ship that could generate 500MW to South Africa, six months later another ship and then every four months another one.

Eskom, however is not so enthusiastic about the idea. "There are a few potential suppliers of power plant-ships. A fair and transparent process needs to be followed for that. The right to purchase the service rests with the Department of Energy," Eskom said last week.

Nevertheless, it is the only one of Tsotsi's three plans being seriously considered.

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