Eskom to seek authorisation to proceed with repurposing of four coal stations

  • Jul 08, 2020
  • Engineering News

State-owned electricity producer Eskom aims, within the coming months, to seek authorisation from its board and government to initiate a formal bidding process for the repurposing and repowering of the Camden, Komati, Grootvlei and Hendrina coal-fired power stations using lower-carbon generation technologies.

All units at the four stations, which currently employ some 1 530 people directly, are scheduled to stop producing electricity between 2021 and 2028.

Should board and shareholder approval be received, Eskom will issue a request for proposals (RFP) for the repowering and repurposing of the stations.

The RFP will be guided, in part, by responses to four requests for information (RFIs) issued to original equipment manufacturers (OEMs) earlier this year by the generation division for specific conversion options, ranging from gas and photovoltaic systems, to biomass and battery storage.

The bid documentation is also likely to be influenced by responses to an expression of interest (EoI) process being overseen in parallel by Eskom Research Testing & Development, which is assessing prospects for broader energy and nonenergy solutions that have the potential to create sustainable livelihoods for those communities that have hitherto relied on coal mining and electricity generation.

Of the four Mpumalanga stations, only Hendrina still has a tied coal mine in the form of the Optimum colliery. However, the plant is receiving all of its coal by road currently after the mine entered business rescue.

The closing date for responses to the Camden, Komati, Grootvlei and Hendrina RFIs was June 5 and Eskom has extended the closing date for responses to the EoI to July 23, partly to accommodate the disruption caused by South Africa’s Covid-19 lockdown.

During a clarification meeting, held on June 15, Eskom informed potential respondents that the RFIs had been issued to assess the market appetite for public–private partnerships and to identify commercially available alternative power generation technologies for the plants.

The OEM respondents were requested to provide solutions able to meet the Technology Readiness Level 9 (TRL 9) threshold, classified by the Technology Innovation Agency as technologies that are in full commercial operation. The OEMs were also requested to offer similarly mature ash-processing and wastewater technology proposals for the stations.

Respondents to the EoI, by contrast, are entitled to propose less commercially proven solutions, so long as they meet the TRL 6 threshold for prototype demonstration projects.

While the RFIs are specific to each station, submissions for the EoI are expected to be complementary, adding a more comprehensive dimension to the proposed repurposing effort.

Environmental and regulatory approvals would be required and any generation project arising would either have to be aligned with allocations outlined in the Integrated Resource Plan 2019, or receive permission from the Minister to deviate from the plan.

JUST TRANSITION

GM for risk and sustainability Andrew Etzinger tells Engineering News that the aim is to repurpose the four stations in a way that takes advantage of existing resources, especially the land surrounding the plants, as well as the infrastructure, including the high-voltage yards that connect the stations to the grid.

Eskom’s total gross land holding is 214 ha at Komati, 326 ha at Grootvlei, 850 ha at Camden and 957 ha at Hendrina.

Etzinger stresses, however, that the main objective is to align Eskom with government’s goal of ensuring a “just transition” for those workers and communities whose livelihoods are currently inextricably tied to the stations.

Eskom’s newly established just energy transition project office is helping to coordinate the repurposing effort, revealing that the office has drawn in all aspects of the organisation, including the new generation, transmission and distribution divisions.

The office is headed by Mandy Rambharos, who is the utility’s climate change and sustainable development manager.

“There are multiple facets to the just energy transition project,” Etzinger stresses.

Linked to the repowering and repurposing of the stations, Eskom is exploring a just energy transaction through which it aims to access concessional finance in return for a firm commitment to accelerating its decarbonisation efforts.

Such a transaction could help improve the group’s financial position, which has been made unsustainable by a R450-billion-plus debt burden. Eskom is on record as stating that it would be in a position to manage its debt only if it were reduced to R200-billion.

“It’s a big and complex exercise and the office, which is not a physical office but an arrangement of people, has been set up to ensure that everyone is kept in the loop and all the components come together,” Etzinger concludes.

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