Eskom must invest another $15bn by 2022 to keep electricity grid working

By Peroshni Govender

CAPE TOWN, Oct 4 (Reuters) – South Africa’s ageing electricity transmission grid needs investment of $15 billion by 2022 to help cope with increased new energy production, an executive at German state development bank KfW said on Sunday.

Africa’s most advanced economy is investing heavily in renewable energy to counter chronic electricity deficits but power utility Eskom’s ageing grid is making feeding more electricity into the system difficult.

Electricity pylons are seen near Arnot Power Station's cooling towers, east of Middelburg in Mpumalanga province, September 8 2015. South Africa's struggling power utility Eskom has marked 30 straight days without imposing rolling power cuts, providing a spark of hope to an economy on the brink of recession. REUTERS/Siphiwe Sibeko
Electricity pylons are seen near Arnot Power Station’s cooling towers, east of Middelburg in Mpumalanga province, September 8 2015. South Africa’s struggling power utility Eskom has marked 30 straight days without imposing rolling power cuts, providing a spark of hope to an economy on the brink of recession. REUTERS/Siphiwe Sibeko

The renewable energy programmes aim to deliver 17.8 gigawatts (GW) of green power by 2030 with 1 827 megawatts (MW) renewable energy now contributing to an installed capacity of 45 000 MW.

“South Africa lacks transmission infrastructure which is needed to enable the country to meet its target,” Ihno Baumfalk, KfW’s senior energy and climate project manager, told Reuters on the sidelines of the South African International Renewable Energy Conference (SAIREC) in Cape Town.

“At present you need to do grid strengthening in order to accommodate the additional energy generation which is being put into the grid.”

Baumfalk said of the $15 billion South Africa needed to upgrade its transmission infrastructure, $3 billion should be earmarked for infrastructure to connect renewable projects.

KfW has given Eskom a R4bn ($291m) loan to help modernise its power grid to enable it to connect solar and wind power plants to the system.

Eskom spokesman Khulu Phasiwe said the utility would announce its plans to strengthen the grid over the next decade on Oct. 16 but declined to give further details.

“We don’t work in isolation. There are problems but we are working on it,” Phasiwe said.

A failure to build any major power stations since the end of apartheid in 1994 has forced Eskom to resort to regular power cuts to protect its over stretched grid from total collapse.