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Generation of Electricity
BY Yasmin Mahomedy
South Africa
31 October 2018
R 10 080.00 (ZAR)  
estimated $ 715.05 (USD) *
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The Generation of Electricity


State-owned entity Eskom, responsible for 90% of the country’s power generation, remains financially and operationally fragile and continues to struggle with declining electricity sales, looming coal shortages, financial instability, and corruption and mismanagement. Eskom, which operates 30 power stations with a total nominal capacity of 45,561MW, reported a loss of R4.6bn in the 2017/2018 financial year and more than R19bn in irregular expenditure has been identified. Sales revenue declined by 2% to R95.5bn, net cash generated from operations decreased by 30% to R22bn, net finance costs increased by 53% to R10bn, and net profit after tax declined by 34% to R6.3bn. Eskom’s interest payments amount to R215bn and debt repayments to R228bn over the next five years.


Progress In Renewable Energy


The electricity generation and distribution landscape in South Africa is changing and the draft Integrated Resource Plan makes it clear that renewable energy will be the focus in the next decade. The stalled programme to award new contracts to Independent Power Producers has recommenced as part of government’s plan to bring online 17,800MW from renewable sources by 2030 in order to lessen South Africa’s reliance on coal and help reduce the country’s carbon emissions.


Report Coverage


The report on the electricity sector examines current conditions and describes the developments in the generation of electricity in South Africa. Profiles for 13 companies are provided, ranging from Eskom to renewable energy producers such as Coria Investments, which trades as the Noblesfontein Wind Farm and the Hopefield Wind Farm Local Community Company.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 5
2.2. Geographic Position 6
3. SIZE OF THE INDUSTRY 7
4. STATE OF THE INDUSTRY 8
4.1. Local 8
4.1.1. Trade 12
4.1.2. Corporate Actions 13
4.1.3. Regulations 13
4.1.4. Enterprise Development and Social Economic Development 15
4.2. Continental 16
4.3. International 18
5. INFLUENCING FACTORS 19
5.1. Economic Environment 19
5.2. Rising Operating Costs 20
5.3. Supply and Availability of Coal 20
5.4. Corruption and Mismanagement 21
5.5. Technology, Research and Development (R&D) and Innovation 22
5.6. Labour 23
5.7. Electricity and Equipment Theft 25
5.8. Environmental Concerns 25
6. COMPETITION 26
6.1. Barriers to Entry 26
7. SWOT ANALYSIS 27
8. OUTLOOK 27
9. INDUSTRY ASSOCIATIONS 28
10. REFERENCES 28
10.1. Publications 28
10.2. Websites 28
APPENDIX 1 30
Summary of Major Players 30
COMPANY PROFILES 32
ACWA POWER SOLAFRICA BOKPOORT CSP POWER PLANT (RF) (PTY) LTD 32
ASSOCIATED ENERGY SERVICES (PTY) LTD 34
AVON PEAKING POWER (RF) (PTY) LTD 36
CENNERGI (PTY) LTD 38
CORIA (PKF) INVESTMENTS 28 (RF) (PTY) LTD 41
DEDISA PEAKING POWER (RF) (PTY) LTD 43
ESKOM HOLDINGS SOC LTD 45
HOPEFIELD WIND FARM LOCAL COMMUNITY COMPANY 50
KELVIN POWER (PTY) LTD 51
NATIONAL ENERGY REGULATOR OF SOUTH AFRICA 53
PHELAN ENERGY GROUP (PTY) LTD 56
ROSATOM CENTRAL AND SOUTHERN AFRICA (PTY) LTD 58
SEF (SOC) LTD 60