Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom

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Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Quarterly System Status Briefing:
Summer Status

Brian Molefe
Group Chief Executive

16 November 2015
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Content

          Introduction

          Winter performance

          Summer outlook

          Recovery and build
          programme

          Conclusion

                               2
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Overview

• Eskom continues to supply 100% electricity for the
 most part, while performing maintenance
• To date, we have had 99 days with only 2 hours and
 and 20 minutes of load-shedding.
• The recent introduction of a new maintenance methodology called Tetris
 enables effective management of maintenance with no load shedding
• The performance of our generation fleet has stabilised with unplanned
 outages (UCLF) below target of 7 000MW
• The New Build programme delivered 720MW to the grid with the
 commercial operation of Medupi Unit 6 on 23 August 2015
• Our focus is on fast tracking the capacity build programme
• Summer projections is that no load shedding is expected.
                                                                           3
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Content

          Introduction

          Winter performance

          Summer outlook

          Recovery and build
          programme

          Conclusion

                               4
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Since Winter 2015 was warmer than last year, more
maintenance was performed while still supplying 96% electricity

    •   Eskom performed three times
        more maintenance this past winter   •   Renewable energy contributed up
        than ever before                        to 1 300MW during the day, of
                                                which 800MW was from solar and
                                                500MW from wind, including
    •   Typically the winter demand for         Eskom’s Sere wind farm
        electricity increases along with
        localised power outages and
        illegal connections putting         •   All available levers were used to
        additional strain on the power          contain the level of load shedding:
        system                                  - Independent Power Producers
                                                - Open Cycle Gas Turbines
    •   While load shedding was                 - Demand Market Participation
        implemented this winter, Eskom
        continued to supply up to 96% of
        electricity during this period
                                            •   Coal stock levels were at healthy
                                                levels throughout the winter with an
                                                average of 51 days

                                                                                       5
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Introduction

Winter performance

Summer outlook

Recovery and build
programme

Conclusion

                     6
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
In summer, the system is tight all day up to 10pm, showing a
  flat “Table Mountain” profile

                              “Table mountain” profile       Typical Winter Day           Typical Summer Day

Summer and winter typical daily load profiles
MW

        36 000

        34 000
        32 000

        30 000
        28 000

        26 000
        24 000

        22 000
        20 000
              23:00   02:00   05:00    08:00    11:00    14:00   17:00   20:00    23:00   02:00

                                                                                                          7
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Eskom will continue to execute maintenance without load
  shedding throughout the summer period (1/2)

• While the system remains tight, Eskom will
  continue with maintenance with no or
  limited load shedding

• Summer is likely to be hotter than last
  year, with a higher expected demand in
  electricity throughout the day as
  consumers switch on air conditioners and
  pool pumps

• We plan to meet demand for electricity 100% of the time and implement
  stage 1 load shedding only when demand increases beyond available
  capacity

• The 2hr 20min of stage 1 load shedding that took place on 14 September
  was an extreme incident as there was a loss of a number of generating
  units in quick succession

• Key industrial customers experienced stage 2 load curtailment only once
  in the last 99 days on 9 October 2015 for 5 hr 30 min
                                                                            8
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Eskom will continue to execute maintenance without load
    shedding throughout the summer period (2/2)
• The development of a new methodology, called
  Tetris has resulted in better predictability

          e.g. Medupi unit 6 remained on planned
               outage from 21 October until 9 November with no load shedding
•    Tetris enables us to perform maintenance within our maintenance budget of
     4 500 MW
• During the severe heat wave experienced in early October, Eskom was able
  to perform maintenance without load shedding
• Eskom has connected an additional 43 Independent Power Producers
  (IPP) projects with a total capacity of 2 147 MW of which 2 021 MW is in
  commercial operation
• An additional 334MW from the Department of Energy’s Dedisa IPP
  project
• Coal stock is sustained at healthy levels of 58.2 days on average
• Dam levels are currently at 58%                                                9
Quarterly System Status Briefing: Summer Status - Brian Molefe Group Chief Executive - Eskom
Capacity outlook until August 2016
                          Available Capacity    Operating Reserves         PCLF          UCLF          Peak Demand         Installed Capacity

Capacity outlook from November 2015 to August 2016
MW

45000                                                                                                         1

                                                                                         Winter UCLF
               Summer UCLF                                 UCLF                          6000 MW
40000          7000 MW

35000                                                     PCLF

                          Operating Reserves
30000

25000                                                            Available Capacity

20000
         Nov        Dec            Jan         Feb        Mar             Apr            May            Jun          Jul           Aug
                2015                                                              2016
Source: Tetris V4.03
 1 Additional capacity from IPPs (500MW)                                                                                                 10
Tetris: Overview of planned maintenance from November
 1
        to December 2015

Capacity outlook from November to December 2015   Available Capacity = Installed Capacity - Peak Demand - UCLF
MW

                                                                                                         11
Source: Tetris V4.03
2 Tetris: Overview of planned maintenance from January to
   April 2016
Capacity outlook from January to April 2016   Available Capacity = Installed Capacity - Peak Demand - UCLF
 MW

Source: Tetris V4.03                                                                                   12
Tetris: Overview of planned maintenance from May to
 3
        August 2016
Capacity outlook from May to August 2016     Available Capacity = Installed Capacity - Peak Demand - UCLF
 MW

Source: Tetris V4.03                                                                                    13
On average the demand has been the same between August
and October when compared to 2013, 2014 and 2015

   Weekly Energy Sent out –YOY comparison 2013 - 2015                                                 Insights

                                                                                                      • Despite recent statements in the
                                    Incl IPPs 2015        Incl IPPs 2014        Incl IPPs 2013              media, electricity demand profile
                       5 300
                                                                                                            has remained relatively similar
                                                                                                            over the Aug – Oct over the last 3
           Thousands

                                                                                                            years
                       5 100
                                                                                                      •     Stable electricity supply has also
                                                                                                            led to the increase in
                       4 900                                                                                manufacturing output:
                                                                                                           ‒ Output rose 0.9% year on year
                       4 700                                                                                   compared to a revised -0.3% in
                                                                                                               August
                       4 500                                                                               ‒ Factory production jumped
 Energy (GWh)

                                                                                                               2.2% and was up 1.4% in the
                       4 300                                                                                   three months to Sep 2015

                       4 100                                                                              “Not a bad manufacturing print at all. It
                                                                                                          may be that both the more competitive
                                                                                                          rand and stabilisation of power,
                       3 900
                                                                                                          helped” – Razia Khan (head of Africa
                               38   39       40      41      42       43   44         45         46
                                                          Weeks                                           research at Standard Chartered”

Source: Eskom Transmission, Reuters, The Witness                                                                                                      14
Introduction

Winter performance

Summer outlook

Recovery and
build programme

Conclusion

                     15
Progress at Majuba Power Station (1/2)

  •   Majuba Power Station experienced a   •   An interim solution is currently in
      coal storage silo collapse on 1          place and has been in operation
      November 2014                            from 1 October 2015
  •   A short term solution was            •   This includes a newly constructed
      implemented with coal being fed          temporary conveyer belt to ferry
      through an elevated mobile boom          the coal
      feeder
  •   The power station has been able to
                                           •   The use of trucks to transport coal
                                               has been curtailed from an average
      run at full load from February
                                               of 1060 trucks before the
      2015
                                               implementation of the interim
                                               solution to an average of 90 trucks

                                                                                     16
Progress at Majuba Power Station (2/2)

   Permanent solution

   •   Designs for the permanent solution have
       been completed

   •   This includes re-instatement of the
       damaged silo and the associated coal
       conveyor system

   •   Two other coal silos will also be reinforced

   •   A tender enquiry was issued to the market
       and closed on 03 November 2015

   •   Evaluation in progress and anticipated
       contract award date is 01 December
       2015

   •   Construction will be complete by 31
       December 2017

                                                      17
Progress at Duvha Power Station

  Progress update

  •   Duvha Power Station experienced an over-
      pressurisation incident in March 2014

  •   The collaborative process undertaken
      in conjunction with the Loss
      Adjuster is nearing completion

  •   An indicative settlement offer has been
      made by the insurers and the Loss Adjuster

  •   The boiler needs to be replaced, however,
      issues of technology assessment and cost
      uncertainty have delayed progress on this
      project

  •   A proposed investment and commercial
      process will be submitted to the Eskom
      governance committees for a decision on the
      way forward

                                                    18
Build Programme - current scheduled dates
   The Intention is to fast track the build programme
Medupi           Commercial operation dates
Unit 6 (794MW)      23 August 2015
Unit 5 (794MW)       March 2018
Unit 4 (794MW)       July 2018
Unit 3 (794MW)       June 2019
Unit 2 (794MW)       December 2019
Unit 1 (794MW)       May 2020

Kusile           Commercial operation dates
Unit 1 (800MW)       July 2018
Unit 2 (800MW)       July 2019
Unit 3 (800MW)       August 2020
Unit 4 (800MW)       March 2021
Unit 5 (800MW)       November 2021
Unit 6 (800MW)       September 2022

Ingula           Commercial operation dates
Unit 3 (333MW)      January 2017
Unit 4 (333MW)       March 2017
Unit 2 (333MW)       May 2017
Unit 1 (333MW)       July 2017

                                                        19
The New Build Programme and Recovery Projects will
contribute 5 620 MW to the network over the MYPD3 window
                                                                                                                                             xx     MW added to
                                                                                                                                                    the network
                                                                                                                                                    Post MYPD3
                      • First sync Mar 2015
                      • Full stable power by
 • Commissioned in      Jun 2015
   early Mar 2015     • Commissioned Aug
 • Additional 100MW     2015                             • Ingula Unit 4 first       • Ingula Unit 1 first           • Kusile Unit 1 First sync
   added to the       • Additional 794 MW                  sync in Jan 2017            sync in May 2017                in Nov 2017
   network              added to the network             • CO by Mar 2017            • CO in Jul 2017                • CO in Jul 2018

    100                         794                                333                           333                           800
   Mar 2015                 Jun 2015                            Mar 2017                    Jul 2017                     Jul 2018                 5 620
Sere Wind Farm            Medupi Unit 6                       Ingula Unit 4               Ingula Unit 1                  Kusile 1

    Mar 2015                                Jan 2017                          May 2017                       Mar 2018
 Majuba Recovery                          Ingula Unit 3                     Ingula Unit 2                    Medupi 5

       1200                                  333                                   333                        794                                     600

• 600MW from unit 3 gap               • Ingula Unit 3 first              • Ingula Unit 2 first         • Medupi Unit 5 first              • Duvha 3 will be fully
  solution in Feb &                     sync in Oct 2016                   sync in Mar 2017              sync in Sep 2017                   recovered in
  600MW from Unit 4 in                • CO by Jan 2017                   • CO by May 2017              • CO in Mar 2018                     2019/2020
  Mar 2015                                                                                                                                • This project falls out
                                                                                                                                            of MYPD3 window

SOURCE: Team analysis
                                                                                                                                                             20
1 Dates based on P80 Schedule
We will collaborate with our customers to reduce demand-
“Less is more − Live Lightly!”

                      Saving electricity reduces pressure on the grid, cuts your electricity
                      bill and reduces South Africa’s carbon emissions
                      The power system remains vulnerable all day during summer
                       1. Use air conditioning efficiently                       “Know your
                           o   Set air conditioning to 23ºC                       number”

                           o   Close windows and doors to optimise air conditioning
                           o   Switch off 30 minutes before leaving the office
                       2. Switch off all geysers and pool pumps (all day until 9pm), and
                          invest in a timer
                       3. If you use the pool frequently, limit pool filtering cycles to two
                          cycles daily, and not between 5pm & 9pm
                       4. Switch off all non-essential lighting
            “Live      5. Respond to Power Alert messages by switching off all
           Lightly”       appliances that are not being used

                                                                                          21
Conclusion

   We endeavour to perform maintenance with no load shedding this summer

   To date we have had 99 days with only 2 hours and 20 minutes of load-
   shedding.

   Key industrial customers experienced stage 2 load curtailment only once in
   the last 99 days

   Eskom will fast track its build programme to ensure supply in winter

   We appreciate the support of all our customers and encourage that we
   maintain 10% electricity savings

   Eskom will continue to provide regular updates on the state of the power
   system through various media platforms

Please also follow us on twitter @Eskom_SA and @Eskom_MediaDesk for
updates
                                                                                22
Thank you
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