Dom Williams of SOLA Future Energy has recently written this article for Fin24 regarding Eskom’s inability to produce cheaper energy.
Renewables pose a threat to coal and nuclear, because wind and solar are undeniably cheaper forms of energy, argues Dom Wills.
This year Eskom turned 94 years old. But so far 2017 has been one of the most damaging years yet for South African’s besieged power utility.
In 2008 and 2014 Eskom had to cope with load shedding and the power utility took a lot of heat for the rolling blackouts and the subsequent damage to the economy. Yet, during those years, Eskom was at least perceived to be the good guys doing a tough job.
This apparent positive spin led to many South Africans and businesses supporting Eskom’s initiatives to cut energy consumption and increase efficiency.
In contrast, 2017 paints a bleak picture. When compared to 10 years before, the figures speak for themselves. In 2007, Eskom sold 218 TWh electricity for 18.33c per kwh at a 16.11% profit margin. A decade later in 2017, Eskom sold less power – 214 TWh electricity for 82.66c per kWh at a 0.5% profit margin.
Thus, in the last 10 years, the state utility has grown worse off. It is selling less power, for higher tariffs, at a lower profit margin. This begs the question whether solutions exist that could reduce Eskom’s costs and boost profit. And could Eskom implement these solutions?