Ina Opperman

By Ina Opperman

Business Journalist

Draft IRP23 conclusion urgent for investment and planning

The Department of Mineral Resources and Energy published the much anticipated draft IRP 2023 on 4 January 2024 for public comment.

The conclusion of the Draft Integrated Resource Plan (IRP23) is extremely urgent to allow for investment decisions and long-term planning as load shedding has reportedly cost the South African economy approximately R225 billion between the first quarters of 2020 and 2023.

South Africa has experienced severe load shedding almost daily since September 2022 and this can largely be attributed to a significant drop in the Energy Availability Factor (EAF) of the Eskom coal fleet that were not maintained properly, as well as shutting down units at Koeberg for life extension, Dr Titus Mathe, CEO of the South African National Energy Institute (SANEDI), says in his preliminary view of the IRP23.

He says the challenges experienced at Kusile when the entire power station had to shut down also contributed significantly to higher levels and frequency of load shedding. This made the time between 2022 and 2023 the worst years in terms of higher stages and frequency of load shedding in the history of Eskom.

“Arguably, the cost of the loss of R225 billion to the economy will give rise to a positive return for any investment option available, such as the renewal or upgrade of existing coal power plants, new nuclear build, new cleaner coal technologies, new gas to power, new solar to power, new wind to power and energy storage facilities, as well as energy efficiency and demand side management initiatives to eliminate load shedding.”

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It will take years if not decades for economy to recover

He points out it will take several years, perhaps decades, for South Africa to recover economically from the dire consequences of this excessive load shedding. The outages caused disruption of essential services and business activities, aggravation of socio-economic inequalities, shutting down of small businesses, disruption of educational institutions and stifling of economic growth which add to the high unemployment rate and higher cost of living.

“As South Africa transitions towards a low-carbon economy, it can now carefully balance the energy mix with other pressing matters faced by the country, such as reducing levels of load shedding, unemployment, poverty, inequality and slow economic growth.”

Among the positive aspects of the IRP23, Mathe noted that the IRP23 aligns with national priorities and international agreements as it correctly points out that its main purpose is to ensure the security of electricity supply while considering the environment and total cost of supply.

He also notes the IRP23 reiterates South Africa’s long-standing position to pursue a diversified energy mix while ensuring compliance with the country’s emissions reduction plan that includes technology options which form part of the draft IRP 2023 horizons one and two scenarios and pathways.

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Public engagement about IRP23 is good

Mathe also commends the department’s approach to public engagements involving senior officials and specialists leading discussions and says collaboration with renowned academic institutions and research councils demonstrates a commitment to leveraging diverse expertise in shaping the energy future of the country.

The department’s decision to release all data used for modelling and analysis is a positive step. As part of the public consultation process, the department made data used for modelling and analysis available, including assumptions made for Horizons 1 and 2 scenarios and pathways.

However, Mathe also points out that there are gaps in the IRP23, such as insufficient clarity on the practical implementation strategies for the life extension of coal power plants that will be challenged by compliance with Minimum Emission Standards.

“The plan to address this is not mentioned. If exemptions are not granted or it is uneconomical to extend the life of some of the power stations, security of supply and grid stability may be a challenge. The draft IRP23 must explicitly state that it is assumed exemptions will be granted by the department of forestry, fisheries and environment.”

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More information needed about life extension of power stations

Mathe says the draft IRP must also explicitly indicate which power stations’ life will be extended and how much it will cost. This should then be compared to the cost of unserved energy to the South African economy.

Another gap is that there is no explanation although the IRP23 highlights that more than 14 000 km of new transmission lines are required by 2032. “Given Eskom’s record of only building 4 000 km in 9 years, it must be explained how Eskom will build 14 000 km in 8 years. The IRP should also include a plan for private sector involvement before the end of the public consultation period so that the public can engage with the plan.”

Mathe also questions that there seems to be limited intervention for addressing inertia, frequency instability and system strength through technologies such as synchronous condensers that are not mentioned.

In addition, he noted the electricity demand forecast should consider three scenarios, namely electricity demand with low uptake of energy efficiency, which is the current scenario, electricity demand with moderate uptake of energy efficiency and electricity demand with high uptake of energy efficiency.

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Eskom shut-down plan left open-ended

The Eskom shutdown plan is also left open-ended and Mathe says there is limited information regarding units or power stations to be considered for running beyond 50 years.

“It is left up to Eskom to decide based on economic reasons. Eskom is not a supplier of last resort, but rather the state through the department and therefore, Eskom must be given direction regarding shutdown dates.

“Ideally, no coal-fired power plant unit should shut down between 2024 and 2030 to provide baseload electricity and ensure the security of the electricity supply.”

The IRP23 also refer to the Hydrogen Society Roadmap approved by the Cabinet in 2021 but gives no detail about the impact should the Hydrogen Society Roadmap be implemented in the electricity sector.

“There is a need for the IRP to look at the catalytic projects proposed in the Hydrogen Society Roadmap and assess their impact, as well as determine at least a 100 MW new build capacity for Green Hydrogen production and electricity production using Hydrogen Fuel Cells.”

Mathe says while the draft IRP23 has many strengths, there are also gaps that will have to be addressed before finalising the plan.

“The urgency to conclude the draft Integrated Resource Plan cannot be overstated, as it holds the potential to unlock various benefits for the country, such as creating investment opportunities, fostering local skills development, generating job opportunities and establishing valuable partnerships”

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