No load shedding for the rest of Christmas Day

Eskom suspended load shedding for the rest of Christmas Day as of 5am this morning, to the relief of weary South African dealing with power cuts in the middle of the lower demand holiday season.

“The suspension of load shedding on Christmas Day is only possible due to the lower demand for electricity,” the state-run power utility said in a statement on Saturday afternoon.

Read: Bleak holidays ahead as Eskom output plummets to new lows

However, load shedding will be back on the Day of Reconciliation or Boxing Day as many people still refer it on Monday, 26 December, as of 5am at stage 2. Best to stick to the traditional braai for tomorrow.

Eskom said stage 2 load shedding will recommence on the 26^th at stage 2 till 4pm on 27 December, whereafter stage 3 load shedding will be implemented.

“The generation fleet remains unpredictable and vulnerable. Should there be multiple failures of generators, a higher stage of load shedding may need to be implemented at short notice,” the utility warned.

“Eskom appeals to all electricity users to conserve as much electricity as possible during this period,” it added.

South Africans have been subjected to intense load shedding for weeks and this year will go down as the worst year for power cuts in the country’s history.

Read: No Christmas present for Eskom

According to the EskomsePush app by Friday afternoon, South Africa experienced 3 600 hours or 150 days of load shedding in 2022.

During Eskom’s FY2022 results briefing late on Friday, outgoing COO Jan Oberholzer repeatedly stated that the next three months will be extremely challenging with one unit at Medupi, four at Kusile (one not yet in commercial operation) as well as one at Koeberg will be unavailable for months.

These units alone account for about four stages of load shedding.

With Eskom unable to provide the electricity the country needs during much of the December holidays, when the major factories are closed, there is real concern about what happens when the economy ramps up again in mid-January.

The utility’s own data show a new record low energy availability factor (EAF) of 50.73% for the week ended December 18, even worse than the record low the previous week of 51.55%.

Read: Ramaphosa must now stabilise Eskom and be decisive

Oberholzer said during the results briefing that the new Eskom board has set the interim target of an EAF of 65% by the end of 2023.

“We will try our very best to achieve that,” he said, but added that it will “at least be above 60%”.

Eskom’s financials 

On the financial front Eskom’s results for the year ended March 31 2022, released months after the legislated September 30 deadline, showed some improvement on the back of a R31 billion government injection, a 15% tariff increase as well as a partial recovery of sales post the Covid-19 restrictions.

Eskom reported a net loss after tax of R12.3 billion, which is a 51% improvement on the R25 billion net loss (restated) reported for the previous financial year.

Read: Eskom’s fifth straight loss compounds SA’s load shedding woes

The utility said the loss “is largely attributable to the unsustainably high finance costs and primary energy expenses, specifically the expenditure to supplement generation capacity through the usage of Open Cycle Gas Turbines (OCGTs). Expenditure on fuel for the OCGTs doubled to R14.7 billion, from R7 billion in 2021.”

Eskom CFO Calib Cassim expressed concern over the growing amount of debt owed by municipalities and said the government plan to take over some of Eskom’s debt may also include an element of assistance regarding non-paying municipalities.

Constitutional Court ruling

In the meantime, the Constitutional Court on Friday ruled in favour of ratepayers of the Ngwathe and Lekwa-municipalities, which each owe Eskom more than R1 billion.

According to News24 the court confirmed an earlier High Court ruling that Eskom is not entitled to reduce supply to these municipalities as it has been doing since 2020.

The ratepayers argued that they were unfairly being punished because their municipalities were in default and have not been given an opportunity to first make representations to Eskom.

This comes as residents in several other municipalities, including City of Matlosana, Matjhabeng and Nala, all owing Eskom substantial amounts, have been complaining of additional power interruptions over and above the countrywide loadshedding.

Outgoing Eskom CEO Andre de Ruyter said during the results briefing Eskom is using load reduction as a last resort to enable the system operator to keep the electricity system stable.

In a letter to Eskom attorney Bertus Maritz from Bokwa Law Incorporated however stated: “The unlawful application of load reductions is being sugar-coated by Eskom stating that the national grid is under severe pressure. However, Eskom is using the unlawful load reduction as an enforcement method to compel municipalities owing money to Eskom to pay Eskom.”

The municipalities were threatening court action unless Eskom gave un undertaking by Friday that it would stop the practice.

Against this background Eskom is forecasting a deterioration of its financial indicators in the current financial year. This it attributes to the poor performance of its generation fleet, high cost of diesel for its OCGTs to support the coal-fired fleet as well as high expenditure on fuel oil.

In addition to that the cost of power purchases from independent power producers and repairs and maintenance is expected to increase.