Shorter contracts should get Karpowerships past the finish line – Mantashe
Mineral Resources and Energy Minister Gwede Mantashe says cutting the proposed contract periods with Karpowership from 20 years to 10 years could help government realise its ambitions to procure energy urgently from the floating power stations.
Mantashe was speaking at an ANC Energy Dialogue held in Johannesburg on Tuesday, during which Eskom announced that Stages 4 and 5 load shedding would be implemented until Sunday.
Karpowership - a Turkish company that provides ship-mounted gas power plants - was awarded three projects under government's 2021 emergency power procurement programme to award around 2 000 MW, but these projects have been unable to reach financial close as the projects are faced with a raft of lawsuits and administrative challenges by detractors.
A key concern has been the 20-year duration of the emergency power contracts.
Mantashe said the Karpowerships remain an emergency power option to help alleviate South Africa's energy crisis.
"People are saying '20 years is too long, reduce it'," Mantashe said. "I think if we can get to 10 years, it will be okay. It will cost us a little bit more per unit … it will be a little bit expensive, but cheaper than the cost of load shedding on the economy," the minister said to a round of applause from the audience.
Mantashe reiterated previous comments that a concerted effort could end load shedding within six to 12 months.
Along with procuring emergency power, he suggested other interventions would help tackle the energy crisis.
These include deploying the requisite skills and other resources to fix and maintain the ageing coal fleet and importing available power from neighbouring countries.
While Mantashe believes that fixing Eskom is entirely possible, "not everyone wants us to do that", he said. "Some people want us to do nothing. Because this issue is agitating society, and they think it is an entry point to take us out of power."
Pravin Gordhan, Minister of Public Enterprises, Eskom's shareholder, said a great deal of work is being done, and there is a clear plan to ensure collaboration to solve the energy crisis as soon as possible.
"The sense of urgency is certainly there. And we will see results sooner or later in relation to bringing some of the megawatts back online," he said. "And that's a combination of fixing the plants at Eskom, buying extra megawatts, seeing some of the IPPs [independent power producers] come online, continuing with the restructuring of Eskom itself, and moving on where possible with the just energy transition.
Gordhan, however, noted there were enormous challenges to deal with at Eskom itself as the new board – which was appointed little more than 100 days ago – found a raft of system issues at the utility.
"There is a serious lack of accountability. There's a dysfunctional culture. The engineering discipline has been badly diluted. There's a lack of routine and proper planned maintenance of the right quality," he said.
"There is a skills exodus that has to be dealt with …There's [inadequate] funding available for outages and maintenance. There's criminality around, and in Eskom itself, the level of corruption is huge around the power stations."
Comments
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation