Eskom prices under scrutiny

A number of complicated challenges raised there. Infrastructure builds for things like roads, power and telecoms are massively expensive. Coordinating with the government and regulators is problematic since the long term view is seldom there.

If we had been consistently upgrading infrastructure over the last 10 to 20 years we could have avoided many of the issues of the last 3 years.
 
And heavy industry and SA's neighbours will continue to get below-cost electricity, so the consumer will have to pay well above the cost of generation to subsidise them. :(
 
How is this possible !!!!!!!!!!!
If you took Medupi at R25 Billion at 10 % per annum for 10 years your total would be about R40 Billion rand.
Assuming at their prices electricity of 97c/kw hr and not over inflated then the cost should be about 47c /kw hr
Is this another arms deal or is the wool being pulled over the eyes as usual.
Maybe ESCOM management and government should be sent a basic EXCEL course where they could work this out with relative ease for themselves.
Sounds like BS to me!!
 
Fuzzbox said:
How is this possible !!!!!!!!!!!
If you took Medupi at R25 Billion at 10 % per annum for 10 years your total would be about R40 Billion rand.
Assuming at their prices electricity of 97c/kw hr and not over inflated then the cost should be about 47c /kw hr
Is this another arms deal or is the wool being pulled over the eyes as usual.
Maybe ESCOM management and government should be sent a basic EXCEL course where they could work this out with relative ease for themselves.
Sounds like BS to me!!
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Have you made allowances for fatcat bonuses in your calculations?
 
ambo said:
A number of complicated challenges raised there. Infrastructure builds for things like roads, power and telecoms are massively expensive. Coordinating with the government and regulators is problematic since the long term view is seldom there.

If we had been consistently upgrading infrastructure over the last 10 to 20 years we could have avoided many of the issues of the last 3 years.
Click to expand...

And if we had spent money set aside for the purpose to do as intended, rather than self enrichment, we also would not have issues.
 
On Tuesday, Mining Weekly reported that national planning commissioner Anton Eberhard had called for a [highlight]formal inquiry[/highlight] into the cost overruns on Medupi and Kusile.
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Is "formal inquiry" not an excuse for establishing a committee to investigate the possibility of establishing other committees?

Where parastatals or tax payers' money or the future of the economy are factors, the buzz phrase "to be subjected to judicial review" should/shall be used.
 
Definitely another skelim in the closet. The arms deal, etolling, eskom... How the **** can the finance charges and the cost of running something be 3times the value of the project???
 
Fuzzbox said:
How is this possible !!!!!!!!!!!
If you took Medupi at R25 Billion at 10 % per annum for 10 years your total would be about R40 Billion rand.
Assuming at their prices electricity of 97c/kw hr and not over inflated then the cost should be about 47c /kw hr
Is this another arms deal or is the wool being pulled over the eyes as usual.
Maybe ESCOM management and government should be sent a basic EXCEL course where they could work this out with relative ease for themselves.
Sounds like BS to me!!
Click to expand...

The interest on their loan for Medupi is R25 billion over the payback period, not the construction cost. The construction cost is R91 billion. Same for the R40 billion interest due on R118 billion cost for Kusile. They should have gone for bonds like they did under the Nats, then at least we could have gotten 10% out of it, not the weenie 3% the banks let us have while they profit.
 
Kind of worrying is the PM on the project as well when a massive steel delivery is the WRONG STEEL!!! WTF??

Interesting that wind is quite close in cost, you would think even if it were slightly more the long term value is better as there is no pollution issue (well very very limited) and we can sell coal to China and India for a nice profit. In fact just tax coal a bit more and it might even pay for the wind farms...

The other strategic reason to look at renewables is that the improvements in these technologies is happening at a fairly rapid pace, so on a 20 year plan the costs will actually come down a lot per output.

Then their are the Thorium and similar reactor types that can actually burn nuclear waste (very simplified I know) that have very limited nuclear threats and don't use fuel that can be weaponised. That and they can be made as small, modular units for a distributed power grid.

But no, we are looking at old high pressure nuclear and suprisingly expensive, dirty coal. :(
 
j4ck455 said:
Is "formal inquiry" not an excuse for establishing a committee to investigate the possibility of establishing other committees?
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Makes sense, TIA.

Maybe they need to give Simcity to Eskom and goverment so they can have a bit of practice in regards to running a country... though they will have to reduce the difficulty to 'retard' level.
 
If they are going to have to borrow the money anyway then why the soggy f|_|ck did they have to go and raise the cost of electricity by like 300-400% since about 5 years back? Wasn't the point to raise money for exactly these two power stations? And I would love to hear what they could build in say the US for $42bil. Probably like 5 massive nuclear power plants.
 
absolutely ridiculous .... this money should be coming from the fiscus and not having us pay double because of the interest .... with borrowing rates at all time lows, how can they be paying 10% ??
 
The Trutherizer said:
If they are going to have to borrow the money anyway then why the soggy f|_|ck did they have to go and raise the cost of electricity by like 300-400% since about 5 years back? Wasn't the point to raise money for exactly these two power stations? And I would love to hear what they could build in say the US for $42bil. Probably like 5 massive nuclear power plants.
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Oddly enough $42bn for 4800mw is not ridiculous (its a bit inflated).

The new AP1000 Nuclear reactor is about 1100MW, and FPL (Florida Power and Lighting) have estimated that 2 of them will cost approximately $17.8bn to build...
 
HOLY MAnIAC said:
Makes sense, TIA.

Maybe they need to give Simcity to Eskom and goverment so they can have a bit of practice in regards to running a country... though they will have to reduce the difficulty to 'retard' level.
Click to expand...

I doubt that the ruling cANCer party would "govern" any differently to the corrupt way they do now if they had practice rounds in a virtual environment, it would be the same resultant disaster for the virtual inhabitants every time (just quicker, only slightly quicker than in real life that is). Corruption and self enrichment are cornerstones of cANCer policy.
 
What a waste of money for coal power plants when they could of just built nuclear ones..little bit more expensive to build, but cheaper to run over long time...
 
10% is all kinds of fk'd up. There are credit cards out the with lower interest rates.

How can a parastatal with access to government guarantees end up with 10%???

Hitachi Power Africa, whose empowerment partner is ANC investment vehicle Chancellor House.
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How this is even legal is beyond me.

Eskom’s average selling price of electricity, which is about 60c/kWh.
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And yet the average consumer pays for more since we need to subsidize all of those sketchy contracts...
 
It would be really great to see each major power station operated privately under best practice business rules - then costs might be related to real world realities
 
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