Ina Opperman

By Ina Opperman

Business Journalist


Energy experts shred Mantashe’s Integrated Resource Plan

Energy experts and economists do not expect the new draft of the Integrated Resource Plan to do much to end load shedding anytime soon.


Energy experts are shredding the Integrated Resource Plan (IRP) that the minister of energy quietly published on Thursday afternoon, with one of them calling it a shoddy piece of work and questioning how it could have been approved by cabinet.

Jee-A van der Linde, senior economist at Oxford Economics Africa, says the draft IRP is poor on details and technical assumptions and the public will want more information regarding modelling parameters and associated supply outcomes.

“Eskom’s plant performance remains a big risk with the utility’s Electricity Availability Factor (EAF) dropping from about 85% in 2010 to roughly 55% in 2023. For reference, the 2019 IRP unrealistically assumed an EAF of 75% spanning 2019 to 2030, at the time when the EAF was averaging roughly 70%.”

He warns that Eskom’s system status outlook for 2024 is worse than ever before, indicating that South Africa can expect to experience an electricity shortfall of about 2 000 MW every week.

“This is bad for the economy, as businesses will yet again be compelled to shield against the disruptions of load shedding, which limits their ability to expand their operations.”

As such, he says, a meaningful pickup in employment and earnings growth is unlikely, with uncertain investors becoming more reluctant to operate in a less competitive market.

“Moreover, continued rapid grid defection by the private sector may only accelerate the death spiral of the utility, resulting in significant electricity price increases for those who can least afford it, which would also reflect in higher consumer price inflation.”

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IRP23 ‘admission of failure’

Prof Anton Eberhard says on X the plan (IRP23) is an admission of failure at eliminating load shedding and it fails to fulfil its declared purpose of ensuring electricity security while minimising environmental impacts and the cost of supply.

He also points out that the plan admits much “unserved energy” for at least the next four years, while it advocates delaying the closure of old coal power stations, working around minimum emission standards and provides dodgy conclusions on a least-cost power system without detailing its input assumptions.

“South Africa’s IRP 2023 is a stitch-up, with pre-determined outcomes in line with what the energy minister has been advocating – wishful thinking around improvements in Eskom power station performance, delays in coal decommissioning, “clean” coal, nuclear energy and lots and lots of gas.”

In addition, he points out that energy minister Gwede Mantashe has failed to make progress in any of these areas in the four and a half years he has been energy minister.

“The only thing he has actually achieved is a slow-down in renewable energy investments: a measly 150MW from projects he procured have actually connected to the grid.”

Eberhard says the plan stands in stark contrast to the electricity plans of most of the rest of the world, such as the IRPs in the US, Australia or Europe where the optimal power mix is solar, wind, gas and storage.

“One of the disastrous consequences of this IRP is that there will be no acceleration in publicly procured renewable energy or enabling regulatory reforms and South Africa will get nowhere close to the R1.2 trillion investment it needs in 60GW of new capacity and grid expansion.”

Energy expert Chris Yelland agreed on X and described the IRP23 as a “shoddy piece of work, lacking in maturity and depth”.

“SA has a wealth of power system modelling competencies which have clearly been ignored in the preparation of this draft IRP. How this work was approved by cabinet for commencement of the public and stakeholder consultation process is beyond me.”

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Integrated Resource Plan 2023 low on power, detail

Van der Linde says the plan is low on power and shows load shedding will continue to undermine the economy until at least 2028.

“However, given Eskom’s poor track record, South Africa will likely be dealing with electricity supply problems beyond 2030.

“The IRP23 is light on important details and contains mixed assumptions. In addition, it does not give electricity price paths under different scenarios, which is a real weakness that the public will undoubtably comment on.”

Although the 54.7% EAF assumption is considered both rational and conservative, based on current plant performance, the plan only sees load shedding ending in 2028. However, Van der Linde says, given Eskom and the department of mineral resources and energy’s poor track record, South Africa will likely be dealing with electricity supply problems beyond 2030.”

“On the other hand, the sharp acceleration of private investment in distributed electricity generation plants can make significant contributions to end load curtailments before 2028 given the plan’s highly conservative assumptions pertaining to the roll-out of distributed generation options, especially considering South Africa’s sharply rising electricity prices.”

Van der Linde says the period up to 2030 seems to contain highly optimistic assumptions about production. In terms of the various technologies, South Africa’s government wants to procure a lot of gas (about 7 200 MW) and anticipates 6 300 MW in distributed generation from industry and households’ self-generation.

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Out with Karpowership, but more ‘clean coal’

He notes that the plan makes no provision for power ships, essentially ending grid access for Karpowership. Eskom’s decision means that the transmission capacity, which is in short supply in South Africa, can now be awarded to other projects.

Looking at other technologies detailed in the updated IRP, solar PV and wind rollout seems very low compared to IRP 2019, making provision for 3 600 MW of solar, 4 500 MW of wind and 3 900 MW of battery storage.

“No new coal capacity is envisioned pre-2030 but the shutdown of some plants will be delayed, which is more costly and bad for emissions. While the draft plan provides due dates for decommissioning of relevant units at coal power stations, this is not accompanied by updated capacity estimates. The plan also refers to clean coal without providing further detail.”

Van der Linde says one positive takeaway is the increased dispatchable power over the medium term, which will help to enhance energy security, although the timing of this generation is delayed from what was planned in the IRP 2019.

“Another positive point is that the draft plan considers the development of South Africa’s transmission grid. Specifically, Eskom’s Transmission Development Plan highlights significant capacity constraints for the transmission lines in the Eastern, Northern and Western Cape regions.

“The plan indicates that historical investment in transmission lines between 2013 and 2022 resulted in just over 4 000 km constructed, while more than 14 000 km of new lines are required by 2032.”

Considering Eskom’s operational woes, Van der Linde points out, this will be extremely challenging and make it difficult for the electricity supply industry to meet the IRP’s annual capacity allocations.

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