Private Sector-led Coal-fired Power Plant Programme to be Launched – by Jan 2015

South Africa’s struggling state utility Eskom has enough money to run until January next year and the government will work out a bailout plan for the future.  South Africa will increase diesel and gas imports and sign a private sector coal-fired power plant deal as it seeks to stem chronic electricity shortages, the cabinet said on Thursday.

South Africa has suffered its worst power shortages since 2008 this month due to creaking infrastructure, power plant failures and emergency maintenance.  State utility Eskom warned that if it didn’t continue to implement rolling blackouts, the entire grid could collapse as it lost up to a third of its 42,000 megawatt power generation capacity.

A private sector-led coal-fired power plant programme will be launched by January 2015, which should add 2,500 megawatts to the grid, but no details have been given on when the electricity would be delivered.

South Africa will increase gas imports to supply its under-fuelled power plants, which should help add 500-2,500 megawatts to the grid, the cabinet said. The gas is mostly expected to come from neighbouring Mozambique.

The government will also sign an agreement with the Strategic Fuel Fund and Transnet Ports Authority to improve diesel supplies to power stations, a problem Eskom has said is a major constraint on electricity output.


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