Untangling the riddle of new power plant repairs

CAPE TOWN — If consistent average power station output was measured like individual subject marks in a pupil’s exams, Eskom would probably fail with under 50%. That’s if you set the bar that high. Do not proceed to a higher class, repeat your lessons until you finally ‘get it’ to step up the learning ladder. The mystifying element with the two-year-ago-completed Ingula pumped-storage project in the Little Drakensberg – now running 25% below installed capacity – is that it was an Eskom CMC Impregilo/Mavundla Joint Venture. The Italian company, dragged to court by a disgruntled local lobbyist wanting his post tender award commission, apparently failed to put in place sufficient quality controls. Now there are defects in all four units, two of which have been switched off to repair. It’s very similar to Medupi and Kusile coal-fired plants, years behind schedule at twice the original cost estimate (currently R145bn). With running repairs at each step of construction, perhaps Pravin Gordhan’s forensic probe there should be extended to Ingula. Would that an international chief operations officer be bared all for public consumption. We’ve seen enough silent public/private complicity in SOEs and at SARS to be deeply suspicious. – Chris Bateman

Eskom’s brand new $2bn power plant is defective

By Loni Prinsloo and Paul Burkhardt

(Bloomberg) – One of South Africa’s newest power plants, designed to supply the grid during peak-use periods, is defective and has been limited to operate at lower capacity.

The deepest power cuts in more than a decade imposed by cash-strapped, state-owned Eskom Holdings SOC Ltd. this month reduced the chances of the continent’s most-industrialised economy posting a stronger recovery from last year’s recession. Eskom is battling to meet demand and is considered one of the country’s biggest risks.

The Ingula pumped-storage project, a hydropower plant, was completed two years ago as part of the government’s program to boost generation capacity, was designed to provide at least 1,332 megawatts during periods of peak demand. However, two of its four units haven’t been operating as they are in a “defects-correction period,” Eskom said in an emailed response to questions.

“A defect has been identified on all four units and registered with the contractor,” which is Voith Siemens Hydro–Voith Fuji Hydro Consortium, the utility said. The units have been “derated” to 245 megawatts when multiple units are running, it said. That means that when all units are operational the plant is running at least 25% below its installed capacity.

The country struggled through 10 days of power outages in March after failures at aging power plants, defects in new coal-power plants that cost billions of dollars and a cyclone that curbed electricity imports from Mozambique slashed supply.

A solution at the Ingula plant “is currently in the development stage,” the utility said.

Ingula generates electricity as water travels from an upper reservoir, through turbines and into a lower reservoir, from where it is pumped back up. The cumulative cost of the project was R29.3bn ($2bn) compared with an estimated R21.8bn in 2010, according to Eskom’s annual reports.