Eskom taken to task for broken promises

Eskom taken to task for broken promises

started the process of building peaking plants'
Ioannis Kessides, the lead economist for the development research group at the World Bank, told the committee that while Eskom runs relatively well, privatisation is the ultimate solution to the crises. He was, however, complimentary of the technology and the resources that Eskom employs.

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I respectfully disagree.
Eskom got where they are from Government finance. In other words public money.
Perhaps in Developed countries Privatisation may work, but Africa is another story.
All that Privatisation means is that the Government sells public assets to Shareholders who in turn Restructure the Company to maximise profits, leaving the consumer with higher prices and poorer service.
Telkom case in point.

Government could "allow" small entrepreneurs to evolve that can generate one or two Megawatts as a test, but who has the Capital to build Power Stations.
But I still think it is a bad idea.
There is so much emphasis on the Red System and Privatisation and I reckon it is all going to end up being a money making racket and Joe Public will be paying double and triple for Electricity before you know it.

It is best if Eskom is left to do what they always did and Government should rather stop interfering with 5 Year Moratorium's that was implemented by our Deputy President for the period 1998 to 2003. The result of that decision is why we are where we are today with diminished capacity.
Also the simple fact that Development is taking off and Government is also providing free electricity to millions of new homes.
This is the truth.
All they need to do is implement the R84 Billion set aside for Eskom and manage the capacity better.
I.E. Why not bring in legislation to prevent the use of the old fashioned light bulbs for a start. Promote Gas Cookers etc
Many of these ideas are already being reimplemented in Cape Town. Free Low Energy Light Bulbs and the swapping out of Twin Hot Plates for Gas Burners.

So many things that can be done before you take something that isn't really broken and try and fix it.

Government should rather focus on making that R84 Billion work for the country. It is our taxes in any event.

BTTB said:

Eskom taken to task for broken promises



I respectfully disagree.
Eskom got where they are from Government finance. In other words public money.
Perhaps in Developed countries Privatisation may work, but Africa is another story.

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For Telkom, I think total privatisation is the only forward: as it is they not only have a "private" company milking the public for all it can, but it is also "publicly" protected by government's ownership - so you get the worst of all words... protected bilking of the public. I am very much against the government (of any country, let alone an African one) being involved in industries - they should just be regulating and "levelling the competitive playing field" - governments are always more wasteful, inefficient and incompetent than the private sector. In fact, governments should be small and receive only as much tax revenue as in needed - governments just don't know how to handle money, whereas NGOs and private companies do... the only way to stop government's waste of money is to not give it to them in the first place! Anyway - so as with Eskom - privatisation is the way to go!

BTTB: Apparently gas is more expensive to run than electricity and therefore people are more hesitant to change to it even though it might help in the long-term.

He was, however, complimentary of the technology and the resources that Eskom employs.

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What technology and resources? It's precisely the lack of resources (and planning) that has contributed to the power crisis! This man must be brainwashed! In addition, skilled engineers are leaving Eskom so how can he be glad about the resources they employ? Almost looks like he went for training in the Eskom marketing department! Also the rotor - the last one in the world - seems to me that our nuclear power plants using ancient technology!

He cautioned the committee that it took at least four years to build a coal-fired power station and at least seven for a nuclear plant.

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You've had 12 years to build either one! If you couldn't see that more people that have access to electricity would increase demand on Koeberg then you must be fools.

Power generation is a capital expensive industry.

These small gas fired units Eskom is installing is nothing but expensive stop gap measures to hide incompetency in planning for the longer term.

The key in managing generation costs is a balance between energy conversion effeciency vs capital costs.

Gas turbines are relatively cheap, fast and easy to construct, but terrible in converting energy to energy (Combustion of gas to electricity). They are also relative easy to startup and shut down and are excellent to respond to peak hour demand changes. They could be used for a few hours a day...

The massive 1000MW "6packs" in Mpumalanga again are highly efficient in energy conversion, but they are expensive and difficult to construct and it takes a loooong time from the decision to build until the first power is delivered. These power giants are much more difficult to start up and shutdown, but the amount of electricity generated can be varied. They are suitable for base load generation, medium term variations (eg summer/winter) and to a certain extent "hourly variations".

Nuclear is an animal of its own kind. It runs excellent as a base load station. It is preferrable to run it at a preset output and not fiddle with anything once it is running. It can't be used to handle spikes etc.

Restructure and Privatise Eskom for whose benefit?

@ignacio. The only way forward for Telecoms now is the complete removal of restrictions to enter the market. Open the market, unbundle the local loop and declare the SAT3 Cable a National Asset.
The Privatisation of Telkom IMHO was a mess. Why were critical assets like the Local Loop and the SAT3 Cable included into Telkom's assets.
Was this negligence on the part of Government or did the skelm little men lurking in the background make it so, knowing full well the results in the end, as evident in many other Multinational Telecom Companies around the Globe.
These little men and woman are now all quiet and you rarely hear a peep from them.
But the Public must now carry the burden of the most expensive services on this planet. A Public Utility Company now in the hands of private shareholders and money men. Probably some of those skelm little men lurking in the background also benefiting.
What did the Privatisation of Telkom do for Unemployment? Farkall.
One can rant on and on, but the damage is done now and we must try and make the best out of a poor situation. It is still going to be a long road.
>The Long Walk/Stroll to Telecoms Freedom in South Africa.
There is so much content one can write a book.

As far as Eskom is concerned.
There is a Company we can/could/should be proud of?
Yet there is so much fiddling and talk going on about Privatisation.
Privatisation may bring better entrepreneurs and a more productive environment, as opposed to what?
Eskom produces 50% of Africa's Electricity Output.
A massive achievement in the African context IMHO. Even internationally as well.
The reason is because of the cheap coal that is plentiful.

How are these clever new entrepreneurs going to fart against thunder?
May sound like a funny example, but Eskom is entrenched and why not.
No private individual shareholders are squeezing it for shareholder value and earnings per share. And these new entrepreneurs will inevitably increase the price of Electricity to make more profits to brag about on the Stock Exchange. And while doing all this restructuring one can be assured that jobs will be shed to make the Company more profitable.

If there was ever one Public Utility that is something that we can thank the previous regime for having the sense to build up and that is Eskom.
Even if they have a few hiccups along the way, they are producing electricity for our country and several other neighbouring nations and have been doing so for quite a while.
Eskom should be left as a Public Utility, end of story and any "enterprising" politician seeking to change it should be rapped over the knuckles big time.
Government should just listen to Eskom when they say, "hello we are running out of capacity, please give us some more money to build a new Power Station".

Don't touch Eskom! Don't fix what aint broke.

@BTTB: Yup agreed on Eskom - excluding the shortfall probs, they are doing a great job.

Re: Telkom, yeah - I mean totally privatise Telkom AND totally liberalise the market.

I am mainly just a proponent of privatisation and unfettered competition... government usually just gets in the way of progress (technology or otherwise). Eskom is one shining exception to this rule.

Eskom is one shining exception to this rule

ignacio said:

@BTTB: Yup agreed on Eskom - excluding the shortfall probs, they are doing a great job.

Re: Telkom, yeah - I mean totally privatise Telkom AND totally liberalise the market.

I am mainly just a proponent of privatisation and unfettered competition... government usually just gets in the way of progress (technology or otherwise). Eskom is one shining exception to this rule.

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I also think the very nature of Electricity as a Utility is a different ball game and your statement that Eskom is the exception to the rule sums it up.
I agree with you that Government usually are poor with business and will inevitably make a mess of something. Look how long it takes Ivy to come out with a few pages in her latest speech and she just talked in circles anyway. Nothing new or dynamic in her speech.

We should not take Eskom for granted. They may have done a sterling job up until this point in time, but I foresee they are going to need public opinion in their favour. There are people (in Government and Private) that have set their sights on acquiring a bite of the apple and this is where we need to stand together and remind Government that Eskom is a tool to provide power to the South African Pubic as cheaply as possible and not a bargaining chip to discuss at Workshops. Imbizo's, about why we should take something that is working and Privatise it, simply because we are told that we are running out of Capacity.
If Eskom was given the money by Government years ago to pay for new base load Power Plants would they be in peril now?
Government is to blame and if that bolt was planted at Koeberg it certainly got the required results from Government to catch a wake up and listen to Eskom when the knock on the door for money.