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Eskom requires $12.60 billion to meet SA emission standards

Eskom emissions

Eskom supplies more than 90 percent of South Africa’s electricity and is heavily reliant on ageing coal-fired plants

South Africa’s power utility giant Eskom requires $12.60 billion to comply with existing legislation against harmful emissions, the local media reported. This was based on the Department of Public Enterprises’ presentation to the parliament. 

Primarily, Eskom uses coal-fired power plants to generate electricity. The company is one of the top 37 polluters in the country. Another utility giant Sasol was granted a five year reprieve until 2020 by the government to meet air and emission standards. 

Eskom supplies more than 90 percent of South Africa’s electricity—and is heavily reliant on coal-fired power stations. However, the company does not generate sufficient cash to meet its mounting debt, the local media said. 

The company’s two mega-coal plants Medupi and Kusile had faced project delays and cost overruns. This mainly contributed to the company’s increasing debt to 440 billion rand.

The Department of Public Enterprises in its report said, “Given the current financial constraints, at this stage Medupi will be prioritised to be retrofitted with Flue-Gas Desulphurisation (FGD technology).”

In September, Eskom said it might have to shut down a few coal-fired plants if it fails to meet the emissions standards. This meant that there could be a potential increase in power cuts in the country. In fact, ageing power plants and poor maintenance were root causes for power cuts in the country all-year round. 

The recent nationwide blackout had affected the economy to an extent that it forced the government to grant Eskom a $4 billion bailout. This is in addition to a $16 billion bailout over a period of next ten years. 

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