Sikonathi Mantshantsha Deputy editor: Financial Mail
Picture: REUTERS
Picture: REUTERS

Half of Medupi power station is operational and a third of Kusile station is adding electricity to Eskom’s total generating capacity, the utility says.

The five additional generating units at the power stations add to Eskom’s reserve margin of about 20%. The two power stations will deliver a combined 9,600MW of power when completed in 2022. The two coal-fired power stations would cost an estimated R310bn when complete, Eskom said.

"Unit 1 of Kusile is now operating at full capacity, and we aim to bring it to commercial production soon," Prish Govender, acting executive responsible for new capital infrastructure at Eskom, said on Thursday.

"Unit 2 of Kusile has also been synchronised into the grid and will reach full production within the next few months," Govender said.

The station near Emalahleni, Mpumalanga, is the latest in Eskom’s capital investment drive. It would cost about R165bn, Govender said.

At the Medupi facility under construction outside Lephalale, Limpopo, two units have already reached commercial production, while the third unit has also been synchronised into the national grid. Govender said the unit would also reach full commercial production during the current financial year.

This means half the R145bn facility under construction since August 2007 is now contributing to Eskom’s generation capacity, helping the utility to avoid power rationing.

Eskom also completed the construction of the 1,332MW Ingula pumped storage facility in the Drakensberg earlier in 2017. Like the other power stations, completion of the Ingula hydro power station was delayed and over budget.

The additional capacity means Eskom now has more than 5,000MW of excess electricity for sale.

The international norm is to have 14% spare capacity.

In addition to hastening domestic connections of new consumers to the grid, the utility has had to accelerate electricity exports to find new markets for its power.

As part of its plan to increase sales to neighbouring countries, Eskom signed an agreement to sell electricity to the Botswana Power Corporation in April while NamPower, its Namibian counterpart, signed in March.

The utility is owed millions in unpaid bills by Zimbabwe.

Eskom still needs funds to complete the infrastructure roll-out. It signed a loan agreement with China Development Bank on Thursday.

According to this agreement, Eskom will borrow $1.5bn from the state-owned bank over the next five years.

The funds are earmarked for the Medupi power station.

Due to poor governance and allegations of corruption at its top leadership, Eskom has had to rely heavily on developmental finance institutions for funding.

More than half the funds it needs over the next five years will come from developmental finance institutions.

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