Despite the fact that Eskom’s temporary power buy-back contracts with large industrial customers, primarily the ferrochrome smelters, were terminated on May 31, the State-owned utility will, for the first time, extend its maintenance season into the high-demand winter months.
The winter maintenance programme will also proceed, notwithstanding indications from some of the ferrochrome smelters, which traditionally conduct their own maintenance during the high-tariff winter months, that they will begin resuming production.
CE Brian Dames says the decision to continue with planned outages of around 10% of its installed base is premised on an analysis showing it is ill-advised to continue to shift out maintenance cycles in a context where many of it units have been operating for three decades or more.
The utility bought back about 1 000 MW of capacity, primarily from ferrochrome producers, between December and the end of May. These limited-duration buy-backs, along with other demand- and supply-side interventions, helped Eskom to reduce demand during summer, and enabled it to ramp up maintenance to an average of 12% of its plant since January. At times, planned outages breach the 15%-of-installed-capacity level.
From April last year to March this year, 1 350 GWh of annualised savings have been recorded, which Dames says is about the equivalent of the consumption of a city such as Bloemfontein.
This “space” created has helped Eskom reduce its outage backlog, which stood at 36 outages at the end of May 2011 and currently stands at around 26 units. Eskom plans to eliminate the backlog, which it believes is to blame for its current high levels of unplanned outages, with are averaging 3 600 MW, by the end of 2013.
Dames refuses to be drawn on the cost of the buy-back programme, but stresses that the commercial contracts were concluded within the envelope sanctioned by the National Energy Regulator of South Africa (Nersa’s) for Eskom’s demand-side management programmes.
Now that the short-term buy-backs have been concluded, Eskom intends leaning more heavily on its other, more permanent, supply- and demand-side programmes, including a recently established incentive to acquire capacity for a number of smaller industrial and commercial consumers, using a demand aggregator. Some 500 MW has been secured though the programme for the winter months.
The utility has also signed up some 800 MW of power generation capacity from independent power producers and municipalities and is working to increase the reliability of supply from Cahora Bassa, in Mozambique.
But coal-supply problems at its Arnot, Matla and Tutuka had lopped an effective 500 MW off supply during the last quarter and Eskom was engaging with the coal-mine owners on ways to improve performance.
Overall coal-stock days have fallen to 39 from 42, but Eskom is specifically concerned about the volumes and the quality being supplied to the three stations from the three tied collieries.
“The challenge for us is not so much meeting the country’s capacity needs, it’s really that, together with the reserve to perform the necessary maintenance,” Dames explains, indicating that this winter it is forecasting that the winter peak will be similar to that of 2011 at around 37 000 MW.