Yesterday Alec Hogg was able to get City Power and Eskom together to explain why the lights had gone out – again! It really seems that at this stage, staggeringly, nobody really knows why the coal silo collapsed, but at least all stakeholders are being upfront and honest about it. We do hope you have electricity so you can actually watch this interview. You’ll learn a thing or two. – CP
GUGULETHU MFUPHI: Welcome back to Power Lunch. South Africa’s power utility Eskom said power outages that began on Sunday would likely continue during the week, after a collapsed coal silo at its Majuba Station cut generation capacity in an already overstretched grid. Joining us in the studio now to discuss this further is Eskom spokesperson, Andrew Etzinger. Before we chat to Andrew, let’s take a look at Sicelo Xulu, MD of City Power had to say about the outages.
SICELO XULU: We actually got a call this morning from Eskom that they’ve called off the load shedding for this week. Seemingly, the sector supply situation has improved and I think it’s actually good news for all of us.
INTERVIEWER: What principles do you use? Eskom has to ask its very big customers to cut down usage. What principles do you use when you decide which area is going to be out? You have residential areas. You have business areas. You have mines. I don’t know. How do you decide?
SICELO XULU: Firstly, the reason for the load shedding is that you have a load that is outstripping supply. Therefore, if people are at home, doing their normal chores at home, and there’s a load that is being picked up at home you need to load shed where there’s load. You cannot go to an area where there’s no one, no load, or low load and load shed. Therefore, the way our schedule is firstly, structured in such a way that it follows the network configuration. It’s structure in such a way that as to avoid critical loads, such as your hospitals for instance and some of the transport nodes. We’ll therefore make sure that the schedule we see on our website looks at certain areas that are drawing loads but avoids in terms of critical loads. That is basically, what we’re looking at but it also needs to [inaudible 01:49] in terms of our network operation because some of our networks are covered in terms of remotely operating them whereas with some of the networks, we have to send people directly on site to be able to actually operate them.
ALEC HOGG: Andrew Etzinger is with us in the studio. The Majuba Power Station – about equidistant between Volksrust and Standerton – so that part of the country. You have to shake your head and say ‘but how does something like this happen’. Firstly, thankfully, nobody was injured or hurt. Has a coal silo anywhere in the Eskom stable, ever collapsed before or indeed, anywhere in the world?
ANDREW ETZINGER: Anywhere in the world – we don’t know. Certainly, at Eskom this is a unique situation. I would imagine that it’s similar to a dam wall collapsing. These things just don’t happen. They’re supposed to be there for the life of the station – 13 years.
ALEC HOGG: How big is it?
ANDREW ETZINGER: If you’re driving through the Free State and you see those big grain silos, it’s about the same size as that – just a bit bigger. Ten thousand tons of coal inside of them and the ultra-pressure of the coal was just too much for the silo. It should not have happened. We do inspections on our power stations’ infrastructure on a regular basis. This particular silo was examined last year and found to be absolutely normal with everything going according to plan, so there are many questions to be answered.
GUGULETHU MFUPHI: You said last year. It’s November now, so last year…that is quite a bit of time. How often/regularly should these inspections be taking place?
ANDREW ETZINGER: You wouldn’t need to inspect this on a yearly basis. Every four or five years, you may need to take a look so last year is very recent. For last year, a concrete structure is fine – a bridge that you’re travelling over, for example. You would need to inspect the bridge.
ALEC HOGG: But that’s the worry. Somebody clearly didn’t do their inspection correctly. Somebody didn’t build it properly. How do we know that we’re going to be driving on the N1 and the bridge won’t just collapse underneath you? These are very serious issues in a developing economy.
ANDREW ETZINGER: I think those are exactly the issues, and so what we need to do is get those questions answered as soon as possible. Why did we not pick up the matter? Who is responsible? Given that particular power station, there are another two silos as well. How do we make sure that the integrity of those silos is not in question, too?
ALEC HOGG: Who built them?
ANDREW ETZINGER: I don’t know, to be honest. I apologise for that. It would have been built about 20 years ago, at the time.
ALEC HOGG: So whoever built them got their money and away they went. How long should they last?
ANDREW ETZINGER: A power station would be expected to last upwards, to 60 years so these would have been built with 60 years in mind. At all other power stations, the last thing to come down is the silo. It’s a piece of equipment that generally gives no problems.
ALEC HOGG: A gent I know very well in the construction industry has a huge building here in Rosebank and after they started, they realised that the plans were incorrect. They only picked it up – almost by accident. They had to go back and restart the whole thing. Everybody knew that it wasn’t going to be accurate. If they had not gone back, there was a potential for collapse so there are so many different links in the chain. I can therefore appreciate when you say that it’s going to take you three months to investigate exactly, where the issue is. Do you have any understanding yet, though?
ANDREW ETZINGER: We’ve gone through the rubble over the weekend and what seems to have been the case is that very early indications are that there was some corrosion on the rebar within the structure. Inside the encasement, there are steel reinforcements of the concrete and it appears that once again, some corrosion had happened, which should not have happened. You should not be seeing the level of corrosion we saw. We’ll investigate.
ALEC HOGG: All right, so we know there’s a problem, but what happens from here? You said ‘no load shedding today’ but where do we go into the future?
ANDREW ETZINGER: The recovery plan has gone well since Saturday and we’ve managed to get coal into at least two of the six units at the power stations so we’re getting power from two of the generators, which means that we’re not in load shedding. We’ve managed to avoid that. That’s two of the units. We’ll be bringing back another two on the same basis, and then the final two after about two weeks so the power station itself will be limping along, but the measures are working properly, which means that the silo in itself is not critical.
ALEC HOGG: If I read the media report correctly, you’re getting trucks to actually drive and physically load the coal, where the silo did it previously. What is the cost of that?
ANDREW ETZINGER: It will be small in comparison to the cost of not having it. Bear in mind that at that particular station, it’s unique in the sense that it’s one power station where we don’t have a coal mine at the station so we’re trucking in coal anyway, as well as bringing in by rail. Fortunately, there are trucks there. It just means going a bit further, closer to the station. We have mobile conveyor systems, which we brought in from other power stations. They’re on site. They’ve been erected and currently, we’re loading about 1200 tons of coal per hour into the stations, which is enough to keep two of the units running. We’ll be mirroring that exercise on the other side of the station, getting another two units running. The final two units… Unfortunately, the structure, which collapsed firstly, needs to be cleared before we can put the final solution on Units 3 and 4, but once that’s up and running we’ll be back.
Then of course, there’s the whole process of insurance claiming (possibly) going forward for that construction of the silo again, which would begin. At the very least, coal is going into the station. The station itself is in good order so that’s not the worry, fortunately. Right now, it’s just about transport and logistics, which we seem to have under control.
GUGULETHU MFUPHI: The larger players in the industries…the mining firms and the industrial firms…your communication to them… Are they slightly more cautious now with supply?
ANDREW ETZINGER: The first thing we do as a matter of course is to contact our large industrial customers about any constraints – for two reasons. Firstly, they do have people underground who can be affected by any power disruption. Secondly, we do ask them to cut back on electricity usage on non-essentials where possible, and they always come to our assistance. We’re very grateful for that. Yesterday, as well as the load shedding in the residential areas… We did ask our large industrial customers to cut back so that was done. From today, the industry is back to full production. No load shedding, so under the circumstances, it’s gone very well.
ALEC HOGG: Andrew, this is a bit counterintuitive because when you come out with the announcement as you did yesterday, you got the media together, it was high drama, and people like to sensationalise this thing. Counterintuitively, the South African Chamber of Commerce and Industry has just put out a statement complimenting you on talking more, on being more open, on actually… I’ll quote what they say here. “Eskom has fostered a culture of open engagement with the business community and SACCI trusts that this relationship can be strengthened even further”. Even though it’s hard for you and we see you losing weight every time we see you in the studio, it’s really nice that you are open and honest, and continue. There are no thoughts at Eskom that ‘maybe we shouldn’t have spoken out as bravely as we’ve done’ on all of these issues.
Clearly, what you’ve said to us now is ‘yes, of course it’s a problem. Yes, there are 1200 megawatts that are going to go out of the system it seems, for a period of time, but it’s not the kind of disaster that it’s been painted’.
ANDREW ETZINGER: Absolutely. Our new Chief Executive Mr Mouton has been very clear that he wants us to continue with proactive communication and to be completely transparent. In terms of my mandate as Acting Spokesman, I have to say I have no secrets and nobody else is involved. We’ve been honest, but it’s interesting how communication works. In the modern era, there’s such a desire for real time information that there were complaints that our press conference, which we held yesterday, was a full 24 hours after the event. A few years ago, that would have been regarded as a quick turnaround so I think there are always growing expectations on access to information and live time information through social media etcetera, and of course, we need to respond to that. We were on the social media on Twitter, on Saturday. May statements were issued.
Some seemed to contradict each other but certainly, if I can come back to SACCI, we really do appreciate our relationships with Business Chambers (SACCI), the electricity-intensive user groups and the large industrials as well. It’s through those that we really get into the depths of the issue and I think that once we’ve done that, we’ll realise it’s not necessarily all Eskom’s doing here. I think Eskom’s been dealt a hand of cards. How do we work together?
ALEC HOGG: Play your hand properly. I must tell you a funny story, Gugu. You know that two years ago, when I left the farm and my horse-breeding… Well, yesterday we sold three horses at the sales. There are lots of people around at the sales and the sales then go off, the bidding is continuing, and one of my three horses was in the ring at the time that Eskom switched off the power (well, City Power did) and there wasn’t another bid for the horse. I wonder if I should be sending in my insurance claim.
ANDREW ETZINGER: There we go. Sorry about that, Alec. Of course, we understand that load shedding is highly disruptive and frustrating etcetera, so apologies to you and all the viewers who have been inconvenienced.
GUGULETHU MFUPHI: How can you sting a man who is so respectable? Thank you so much for your time today, Andrew.
ALEC HOGG: He need to stop losing weight because he’s going to fade away.
GUGULETHU MFUPHI: We’ll feed him when he comes next time. That was Eskom’s spokesperson Andrew Etzinger.
Do remember that we want to hear from you and maybe you can tell us about your load shedding experience. Email us on [email protected] or get interacting on Twitter, using #powerlunch410.
