Electricity Emergency Response Plan - South African Industry’s Contribution

A previous post, Rolling Blackouts to Benefit South Africa, hypothesised that the strong reaction to the rolling blackouts Eskom was forced to implement has resulted in urgent action which will in the medium term ensure South Africa has the energy systems it needs for its long term development.

In 2004 the three major users of electricity in South Africa were Industry (64.6%), Residential (17.4%) and Commerce (12.0%). It was therefore logical that once Eskom, with the “urging” of Government, faced the situation and took co-ordinated action it went to industry.

Discussions with industries and especially the large users in mining and manufacturing, were based on Eskom admitting that it was unable to guarantee supplies to industry, presenting a long term plan of action and requesting that industry manage itself to achieve an immediate 10% reduction in its consumption.

Industry supported the request although it lead to week long shut downs of a number of mines which were unable to immediately reduce their consumption without effecting the complete process.

This was termed Phase 1 of the National Emergency Response Plan and was mainly aimed at stabilising the system to avoid catastrophic shut downs that could result from instability induced by too small a margin between demand and supply.

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At the same time Eskom was taking emergency steps to improve power station availability and coal supply as well as preparing managed power shedding in the residential and commercial sectors. These together allowed Eskom to get through its peak demand from May to July without any major unplanned shutdowns. Thus successfully implementing Phase 2 of the National Emergency Response Plan.

Although industry supported the plan, it became evident that it was the large company’s whose cut backs allowed Eskom to achieve its targets. Smaller industry seems not to have reached the 10% reduction, but will presumably reduce consumption in response to tariff hikes.

In 2007, South Africa had one of the lowest electricity costs in the world, of only 3.5 US cents/kWh, compared to 9.5 for the USA, 13.0 for Germany and 23.0 for Denmark. Projects focussing on energy conservation were often not viable and received little attention. However, Eskom has just been awarded a 27.5% increase for the 2008/09 year by the electricity regulator, although it had requested a 53% increase. This along with the increasing capital investment planned, makes it certain that South Africa will have large tariff increase for some time.

Industry will essentially be forced to increase its energy efficiency to remain competitive. On the positive side this will contribute to decreasing electricity demand and to reducing South Africa’s high carbon emissions.

Photo Credit: From Eskom’s online press pack - from Media Room button on right hand menu.

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