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Eskom diesel plan will be announced in the coming days, says Gordhan

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Eskom diesel plan will be announced in the coming days, says Gordhan

Public Enterprises Minister Pravin Gordhan
Photo by Bloomberg
Public Enterprises Minister Pravin Gordhan

23rd November 2022

By: News24Wire

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A plan to deal with Eskom's diesel crisis will be announced in the coming days, Public Enterprises Minister Pravin Gordhan told Parliament on Wednesday.

Eskom said last week that it had overspent its budget for diesel and had no more cash to buy new stocks until 1 April. Diesel is used to run Eskom's two open-gas cycle turbine power plants, each of which can ward off a stage of load shedding.

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News24 reported earlier on Wednesday that Eskom was in talks with the National Treasury to "find a mechanism through which diesel can be bought" to minimise load shedding until the end of the financial year. Government sources said Eskom had requested R10-billion to fund diesel purchases and R5-billion for fuel oil.

Briefing Parliament's Standing Committee on Appropriations, Gordhan said within the next few days, the department would get going on interventions for Eskom's diesel supply for open-cycle gas turbines. 

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"Eskom has utilised a lot of its allocated cash that Nersa [National Energy Regulator of SA] would allow to be recouped in one way or another. We did issue a statement on Sunday which said that we will find the cash and we are still in the processes of engagement around those issues.

"We will, hopefully in the next few days - and I was hoping it would be much sooner - get this process going. But we will issue a statement later today which will indicate what the status is and what the availability of diesel is currently as far as the open-cycle gas turbines are concerned," said Gordhan.

Gordhan said oil costs have been rising, which presented a challenge for Eskom and the electricity grid. He said the country will be kept up to date about Eskom's diesel requirements and the funding needed to fulfil them.

"Given the cost of crude oil and its derivatives like diesel have been rocketing for some time and that has serious implications for the cost factor as well. But we do want to reduce the levels of load-shedding. We do want to have predictability as far as load-shedding is concerned," said Gordhan.

Transnet group CEO Portia Derby told the committee the appropriation of R2.9-billion that the entity was seeking from the fiscus would help Transnet to recover from damage caused by the floods in KwaZulu-Natal and improve capacity to meet the economy and Eskom's commodity demands.

Derby said national coal demand is equivalent to 198 trains, but Transnet only has a capacity of 138 trains available. She added that Eskom's Majuba coal power station has a demand equivalent to 42 trains, but Transnet only has a capacity equivalent to 21 trains.

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