Eskom hits back at De Ruyter’s diesel-burning accusations

Eskom has hit back at speculation that it is burning diesel excessively to power its open-cycle gas turbines (OCGTs) and avoid load-shedding.

In a statement on Friday evening, the power utility said that “contrary to media reports”, Eskom’s use of OCGTs was closely monitored, and their role was strategic rather than extensive.

The utility said it had spent significantly less on diesel to run its OCGTs last month than at the same time a year ago.

“In April 2024, Eskom spent R1.1 billion on OCGTs, producing 167.8GWh,” it stated.

“This is about 60% less than April 2023 when R3.1 billion was spent to produce 470.22GWh.”

Eskom said this trend had continued into the first nine days of May 2024, during which Eskom’s diesel expenditure for OCGTs was R53.9 million.

In addition, Eskom said the OCGT load factor for April 2024 decreased significantly to 6.8% compared to last year’s figure of 19.13% in the same month.

It maintained that the continuous suspension of load-shedding was due to sufficient generating capacity, supported by a more reliable generating fleet.

“Unplanned outages have reduced by 4,400MW since 26 April 2024 due to extensive maintenance and the success of the Generation Operational Recovery Plan initiated in March 2023,” the power utility said.

“The energy availability factor has improved significantly, performing above 60% since 29 April 2024 and reaching 65% on 1 May 2024, with a month-to-date figure of 63.34%.”

While independent energy experts have also commended the improvement, Eskom neglected to mention another key contributor to keeping the lights on in its statement.

The utility has also seen a big reduction in electricity demand, which it previously acknowledged was due to the rapid adoption of private rooftop solar.

Eskom’s reaction comes after News24 reported on Wednesday that former Eskom CEO André de Ruyter had attributed the relief in load-shedding to Eskom burning diesel in its OCGTs “at a rate of knots”.

De Ruyter said that Eskom had a budget of R24 billion for the current financial year, four times what the utility had at its disposal while he was CEO.

Gourikwa open-cycle gas turbine power station

A statement put out by the Democratic Alliance just a few hours earlier on Friday also alleged that the National Energy Regulator of South Africa (Nersa) had “confirmed” Eskom was burning diesel at an “alarming” rate.

That was based on a report from the Mail & Guardian which said Nersa had “called out” Ekom over excessive diesel consumpion.

“According to Nersa, Eskom has already blown more than half of its quarterly budget of diesel for the first quarter of the 2024/2025 financial year in just one month,” said DA MP Mimmy Gondwe.

“Nersa revealed that Eskom has already hit 168.5GWh of the electricity that it is allowed to produce using diesel for the first quarter from April to June 2024.”

While Eskom had confirmed that its OCGT usage in April 2024 was near the claimed amount in capacity, it denied this has resulted in its budget for diesel being exceeded.

“Eskom’s budget for diesel in the current financial quarter (April to June 2024) is R5.8 billion, and R1.16 billion has been spent as of 9 May 2024,” the utility said.

That works out to 19.7% of the total budget for the quarter, lower than the more than 50% the DA had alleged Eskom to have used.

Eskom also said that Nersa only made the determination on how much revenue should be used for OCGTs based on assumptions for the year ahead, while the Eskom board decided on the actual budget.

The board had reduced the 18% load factor in the 2024 financial year, which came to an end in March 2024, to 12% in the next financial year ending March 2025.

Nersa’s allowance was only at a 6% load factor, substantially lower than Eskom’s OCGT load factor.

However, Eskom said its performance in April 2024 aligned closely with Nersa’s 6% load factor.

The utility added that Nersa’s Multi-Year Price Determination methodology also required Eskom to use OCGTs to minimise load-shedding.

Nersa subsequently also released a statement criticising the Mail & Guardian report.

Much of its comment on the matter aligned with Eskom’s and it denied blaming the decreased load-shedding on the utility burning more diesel.

“Nersa distances itself and condemns in the strongest possible terms the incorrect and misleading article published by the Mail & Guardian,” the regulator said.