Eskom is in discussions with the National Treasury on the possibility of building a 3,000MW gas-powered station in Richards Bay, without borrowing additional funds.
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While Eskom was granted approval by the National Energy Regulator of SA (Nersa) to construct a new power station, its facing opposition from environmental groups.
These groups have been granted special permission to appeal against a high court decision that dismissed their objection to Nersa’s consent for the project. Despite the regulatory approval, concerns regarding the environmental impact of the proposed power station continue to be raised.
Eskom has set its sights on supplying electricity to the grid by the end of 2028 through its ambitious gas power project. The proposed combined-cycle gas power plant holds the potential to generate electricity equivalent to three phases of loadshedding.
The project was initially proposed by Eskom to the Minister of Mineral Resources and Energy Gwede Mantashe in January 2022, to which the minister agreed and sent the request to Nersa. The regulator’s approval is a legal requirement for the establishment of any new generating capacity.
Nersa released a proposal for public comments, which drew objections from multiple environmental groups. These objections were primarily centred around concerns that crucial information was allegedly absent from the application and that the consultation process was insufficient.
The Energy Intensive Users Group has highlighted the benefits of gas-fired power generation in effectively managing a power system. Gas can be easily and quickly switched on and off at short notice making it a valuable asset in complementing intermittent sources such as solar and wind power.
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Conflicting views and regulatory reversal surround Eskom’s gas-fired power project
According to City Press, the objections to the gas-fired power generation project have sparked a debate among industry stakeholders. Meridian Economics has raised concerns about the economic viability of such a venture, questioning its cost-effectiveness. Similarly, the Minerals Council SA has expressed apprehensions over the project’s financial implications, highlighting the need for gas importation and potential exchange rate volatility affecting electricity prices.
Nersa initially rejected the project in December 2022, citing procedural errors in Eskom’s approval process, but in February 2023, after a closed-door deliberation, the regulator reversed its decision and approved the project.
Tanica Naidoo, project officer at the South Durban Community Environmental Alliance (SDCEA), has expressed her perspective on the matter, stating that despite the escalating severity of loadshedding, gas generation is not the optimal solution.
‘Communities in and around Richards Bay will be greatly affected if yet another non-renewable plant is approved. Another gas-to-power plant poses risks to health, water, air and land in Richards Bay.
‘Environmental effects need to be considered by the applicants and all parties involved in the decision-making process. Richards Bay is already plagued with polluting industries and we do not need more. It is time for the right decisions to be made in order to ensure the success of our natural environment for generations to come,’ said Naidoo.
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