Pasop, things are far too quiet on the Eskom front

Ideas

Pasop, things are far too quiet on the Eskom front

There are solutions, and a big one would be to bring back Brian Dames, hounded out by Malusi Gigaba

Peter Bruce


A few days without load-shedding and how quickly Eskom vanishes from our TV screens and front pages. But be careful.
I’ve spent the past few days speaking to as many wise heads as I can. The thing they all share is a sense of sadness that SA has come to this: that it cannot guarantee a continuous supply of something as basic as power to a lightbulb.
Everyone I have spoken to raises the prospect, as a real possibility, of a sudden and catastrophic collapse of the grid. Load-shedding is designed, I know, to prevent that, but it is clear from communications from Eskom and the state that they are not on top of the threat.
A national blackout would last one to two weeks. Everything would shut down. There’d be no water after a few days. Water pumps need electricity. Sewerage treatment would stop. Raw excrement would flow into rivers and dams. People would fight for clean water. For petrol. We would overnight become a failed state.
But we are not broken yet. We can still make choices and we must not waste time. How Eskom went from stage four load-shedding to none at all is their secret, but a tanker or two have offloaded tons of diesel at George to power Eskom’s emergency open-cycle gas turbines. I’d put a reporter on the waterfront at George to monitor shipping up to the election if I were still an editor.
The mere fact that we can still choose is important. It’s time to be smart and brave. To give people hope. I had a WhatsApp conversation during the darkness last week with arguably the best analyst of the SA political economy, Peter Attard Montalto. He gave me permission to quote this, written just after the Eskom “press conference”:
“The failure here is ultimately not that load-shedding cannot be stopped, it is that hope has not even been provided. A rapid acceleration of IRP (the Integrated Resource Plan), emergency windows of REIPPP, approving the small-scale embedded generation regulations on [energy minister] Jeff Radebe’s desk would all give hope. It is a failure of governance for political reasons that this is not happening and so hope cannot be provided. Government is I think still struggling to understand the full depth of the operational challenges here and so the tipping point we are at with sentiment and growth.”
The REIPP in there stands for renewable energy independent power producer programme. We should, as a matter of national urgency, be auctioning off more licences to supply green energy into the grid. The small-scale embedded generation regulations are about allowing sources of private sector power (the photovoltaic panel on my roof or the biomass power of a recycler) to link up to the national grid. Helen Zille has written enthusiastically about these this week, arguing Eskom can never recover from the situation it is in.
I agree with her and was writing this at the the end of last year. It should be put into business rescue, I said, which would at least make it easier to deal with creditors. But the fact is that no transition to a new energy future happens without reviving Eskom in the short term. There are two ways to do this. First, its balance sheet must be saved.
That is done by getting Eskom’s weak management to agree to use briquetted coal slurry, two billion tons of which lie in huge “ponds” at all of Eskom’s tied mines. The briquetting (already approved for use by Eskom’s top technicians) is a simple technology. Slurry is what remains when hard coal is washed. But if you could briquette all two billion tons of it that would be enough to fire all of Eskom’s power stations for 20 whole years.
That does two things. First, it is a third of price of the current price Eskom pays for coal. It is already mined so any future mining could be used for exports at higher prices than even Eskom pays. Restating Eskom’s balance sheet to reflect a 66% cut in future coal costs would put it in line to raise its own funding in the markets again. Second, if the unions could be made aware of the potential in the slurry they could become involved in a massive 20-year effort to achieve what they call a “just transition” from dirty to clean energy.
The second route to Eskom’s survival is leadership and the only man in the country to run this company is the former CEO Brian Dames, hounded out of office by Malusi Gigaba in 2014. I am assured that if he were asked, he would return to the job. When load-shedding first started in January 2008 it was Dames who fixed it. He became head of generation and then CEO. There isn’t a tube in Eskom’s fleet that he doesn’t know intimately. He can do this. The government should immediately offer him his old job back.
The first things Dames would do, I suspect, would be to halt all further work on Medupi and Kusile. Simply use what’s already working and walk away from the rest. And then get on to the floor of each power station rather than lurk at Megawatt Park in Johannesburg. Dames’s approach to problems is to walk towards them, and we really need that now.
• Peter Bruce is a former editor of Business Day and the Financial Mail.

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