Eskom COO on 'conveyor belt failures' and reports of R1.8bn in bonuses

'I can confirm that the past two years, no performance bonuses have been paid'

06 January 2020 - 13:59 By TimesLIVE
A conveyor belt failure at the coal-fired Medupi power station pushed the country into stage 2 load-shedding at the weekend. Stock photo.
A conveyor belt failure at the coal-fired Medupi power station pushed the country into stage 2 load-shedding at the weekend. Stock photo.
Image: 123RF/adam88x

Eskom COO Jan Oberholzer said on Monday that coal-handling facilities at Medupi power station would be modified to avoid future breakdowns that have contributed towards load-shedding.

Medupi and Kusile are the country’s two new flagship coal-fired power stations.

It was a "conveyor belt failure" at Medupi, on top of other plants being down, that thrust SA back into stage 2 load-shedding darkness at the weekend.

Asked why the new power plant was not performing up to scratch, having suffered three conveyor belt breakdowns in a matter of months, Oberholzer told Kieno Kammies on CapeTalk radio on Monday: “I will not say it has been shoddy work. This is the way the design has been done and this is the way it has been implemented.

“I have instructed our designers to redesign the coal-handling to ensure redundancy. You must remember, what we have at Medupi, we have exactly the same at Kusile. So if we’re experiencing the problem now at Medupi, for whatever reason, the chance that we’re going to have it at Kusile is very likely.”

The two new power stations are supposed to ultimately supply more than 20% of the country’s electricity. Oberholzer said it was “critical that we fix it”.

Medupi’s unit three, he said, was supposed to be taken offline on Monday for 75 days for design modifications, but this would have to be delayed due to the system being constrained.

Touching on the thorny issue of R1.8bn allegedly being set aside by the power utility for “performance bonuses” up until 2022 – a claim made in court papers filed by the National Energy Regulator of SA (Nersa), which is opposing a demand by Eskom for an additional R69bn from consumers – Oberholzer said the money was actually set aside for 13th cheques for staff.

“This is Nersa’s side of the story, definitely not Eskom’s. I can confirm that the past two years, no performance bonuses have been paid,” he said. 

While a bonus system was in place, the criteria had not been met.

“I spoke to the CFO this morning. That amount stated there [in Eskom’s financial statements] as a bonus is basically the 13th cheque which is part of your employment contract. So it’s definitely not performance bonuses,” he said.

Eskom said on Monday it did not expect load-shedding although the system was vulnerable.

“There is sufficient water at the pumped storage schemes and we have managed to conserve diesel at our open cycle gas turbine generators, and continue to work to replenish the diesel levels. These emergency reserves will supplement the shortage of capacity, if required.

“However, we remind customers that as the system continues to be vulnerable and unpredictable, the possibility of load-shedding remains.”


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