Briefing to WC Provincial Government – Standing Committee on Finance, Economic Opportunities and Tourism

9 October 2019 Briefing - National Matters

2019/10/08 2 3 Introductory Notes

Eskom operates a national grid, which implies:

Generation Plant is not dedicated to the province in which they are located All forms of energy, including renewable energy is dispatched at a national level, not at a provincial or local level.

Eskom Debt – COO will address

Cost Containment – COO will address

2019/10/08 System Status Update

2019/10/08 4 Actual System Weekly Peak Demand (Including IOS)

• The residual peak demand for 2018-19 Financial Year was 34 907 MW. The Year-To-Date residual peak demand for 2019-20 Financial Year is 33 736 (considering dispatchable generation and firm imports). • When including the supply from contracted IPPs (sold to Eskom) the RSA contracted peak demand for 2018-19 Financial Year was 35 345 MW, and the Year-To-Date RSA contracted peak of 2019-20 Financial Year is 34 500 MW. • The contracted demand reductions over peak last week was 280 MW, and the support from Renewable IPPs was 813 MW. Weekly Peak Demand (Financial Year)

2019-20 RSA Contracted Peak Demand 2019-20 Official Residual Peak Forecast 2019-20 Residual Peak Demand 2018-19 RSA Contracted Peak Demand 2018-19 Residual Peak Demand

Weeks

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52

36 000 1

35 000 x 10000 x

34 000

33 000

32 000

31 000 PeakDemand (MW) 30 000

29 000

28 000

27 000

26 000

25 000

24 000 1

08-Jul-19 22-Jul-19

06-Jan-20 20-Jan-20

10-Jun-19 24-Jun-19

14-Oct-19 28-Oct-19

01-Apr-19 15-Apr-19 29-Apr-19

02-Sep-19 16-Sep-19 30-Sep-19 03-Feb-20 17-Feb-20

09-Dec-19 23-Dec-19

05-Aug-19 19-Aug-19

11-Nov-19 25-Nov-19

02-Mar-20 16-Mar-20

13-May-19 27-May-19 5 Week Starting OCGT Usage: - Load Factors YTD

2019/10/08 6 Daily Average UCLF and OCLF figures

Average of Partial OCLF Average of Full OCLF Average of Partial UCLF Average of Full UCLF 14 000

13 000

12 000

11 000

10 000

9 000

8 000

7 000

6 000

5 000

4 000

3 000

2 000

1 000

0

01/04/2019 05/04/2019 09/04/2019 13/04/2019 17/04/2019 21/04/2019 25/04/2019 29/04/2019 03/05/2019 07/05/2019 11/05/2019 15/05/2019 19/05/2019 23/05/2019 27/05/2019 31/05/2019 04/06/2019 08/06/2019 12/06/2019 16/06/2019 20/06/2019 24/06/2019 28/06/2019 02/07/2019 06/07/2019 10/07/2019 14/07/2019 18/07/2019 22/07/2019 26/07/2019 30/07/2019 03/08/2019 07/08/2019 11/08/2019 15/08/2019 19/08/2019 23/08/2019 27/08/2019 31/08/2019 04/09/2019 08/09/2019 12/09/2019 16/09/2019 20/09/2019 24/09/2019 28/09/2019 02/10/2019

7 Regional allocation of installed renewable energy

• From a National perspective, the penetration is not yet at a level which is causing substantial challenges in operations. • Regionally, the local penetration is a lot higher, particularly with PV in the Northern Cape and wind in the Eastern Cape.

CSP 0 PV 118 Wind 0 Other 0

CSP 0 CSP 0 PV 7 PV 0 Wind 0 Wind 0 Other 0 Other 8

CSP 500 PV 950 Wind 664

Other 10 CSP 0 PV 196 Wind 0 Other 4

CSP 0 PV 134 Wind 319 Other 0 CSP 0 PV 70 Wind 997 Other 0

8 Briefing - Provincial Matters

2019/10/08 9 10 Provincial Network Plan

The Provincial Network Plan comprises of:-

 Capital Investment Plan  Maintenance Plan

This Provincial Plan outlines the infrastructure investment and maintenance required to deliver energy to the end customers

2019/10/08 Capital Investment Plan

2019/10/08 11 Network Development Plan Areas

12 Network Development Plans for City of Cape Town Areas

13 Definitions of Project Categories

 Refurbishment

 Modifications of an asset to extend its ‘useful life’. The useful life of most of the Distribution assets is 25-30 years with the exception of the Control Plant (Electronic) assets which range between 5 to 10 years.

 Strengthening

 Increase in the capacity of an asset to cater for increased electrical load demand.

 Reliability

 The improvement in the performance of an asset to prevent degradation or failure of the asset. In the case of Distribution such projects would entail inclusion of redundancy in the design of the asset.

 Direct Customer

 Projects that are initiated and paid for directly by external customers. These include new points of supply, additional points of supply, and improvements to existing points of supply. 14

Project per Network Development Plan Area 2019 - 2023

Ashton: R29m Bluedowns: R64m Ceres: R7m George: R79m Helderberg: R21m

15 Project per Network Development Plan Area 2019 – 2023 (cont.)

Houhoek: R61m Karoo: R6m Khayelitsha: R66m Mooreesburg: R123m Oudtshoorn: R60m

16 Projects per Network Development Plan Area 2019 – 2023 (cont.)

Prospect Hill: R700m

17 Projects per Network Development Plan Area 2019 – 2023 (cont.)

Vredendal: R1,3m Vryheid: R5,6m Worcester: R7m Stikland: R170m

18 Standing Items Maintenance Plan

2019/10/08 19 Asset Definition

 Sub-Stations Sub-transmission Lines >44kv Transformers Conductor and Hardware Primary Plant (Power) Support Structures Secondary Plant (Control) Roads and Fences

 Sub-transmission Cables >44kv Reticulation 11 to 33kv Cables Transformers Poles, conductor, hardware, cables

 Prepaid Meters Prepaid Meters 21 Maintenance Categories

Maintenance Category YTD July 2019 - 2021 Actual (RM) Annual (RM)

Vegetation Management maintenance 1.42 38

Woodpole Programme Maintenance 2.76 25

Reliability Improvement Maintenance 3.92 20

Low Voltage Maintenance 1.17 15

Major Maintenance 10.8 60

PREVENTATIVE MAINTENANCE 21.36 162.71

Self Insurance (Theft & Vandalism) 14.77 44.53 Routine Maintenance and Defect Clearing 57.17 191 - CNC's TOTAL MAINTENANCE 87.35 410.46

2019/10/08 22 Major Maintenance 2019/2020

Sector YTD Actual Budget Allocated

Sector 1 - Bredasdorp, Caledon, Ceres, De 4 195 648 7 690 000 Doorns, Montagu, Swellendam & Worcester

Sector 2 - Delft, Polkadraai, Somerset West & 1 660 056 6 750 000 Kraaifontein

Sector 3 - Airport, Carbon, Malmesbury, 1 173 099 8 153 209 Piketberg, &

Sector 4 - Beaufort West, George, Laingsburg, Oudtshoorn, Plettenberg Bay, Riversdale & 1 239 439 9 920 000 Ladismith

Sector 5 Monwabisi, Spine & Grabouw 4 326 423 8 113 688 23 Reliability Maintenance 2019/2020

Sector YTD Actual Budget Allocated

Sector 1 - Bredasdorp, Caledon, Ceres, De 4 920 954 8 100 000 Doorns, Montagu, Swellendam & Worcester

Sector 2 - Delft, Polkadraai, Somerset West & 252 340 2 000 000 Kraaifontein

Sector 3 - Airport, Carbon, Malmesbury, Piketberg, 92 914 4 300 000 Vredenburg & Vredendal

Sector 4 - Beaufort West, George, Laingsburg, Oudtshoorn, Plettenberg Bay, Riversdale & 187 743 1 000 000 Ladismith

Sector 5 Monwabisi, Spine & Grabouw 425 409 1 700 000 Standing Items Plant Performance

2019/10/08 24 WCOU Five Year SAIDI and SAIFI performance

Eskom FY SAIDI WCOU SAIDI Dx SAIFI WCOU SAIFI Dx

2014 14.90 35.70 7.36 19.89

2015 17.19 35.44 9.26 19.51

2016 15.46 34.60 8.39 18.49

2017 20.35 35.64 8.90 17.16

2018 21.83 35.45 7.69 14.55

2019 YTD Aug 20.53 38.29 7.03 14.94

SAIDI – System Average Interruption Duration Index SAIFI – System Average Interruption Frequency Index WCOU Operating Unit Dx - Distribution

2019/10/08 25 Dx SAIFI and SAIDI comparison YTD (August)

Current SAIFI SAIFI (Shareholders SAIDI (Shareholders Current SAIDI 2019/2020 Target dataset) dataset) 2019/2020 Target Operating Unit (OU) (Prelim) Number per annum Number per annum Hours per annum Hours per annum

Eastern Cape Operating Unit 13.53 22.76 45.57 52.69 Free State Operating Unit 10.46 12.24 26.91 25.03 Gauteng Operating Unit 17.58 18.12 37.18 34.56 KwaZulu-Natal Operating Unit 19.41 22.2 46.09 45.30 Limpopo Operating Unit 14.42 18.75 37.52 35.00 Mpumalanga Operating Unit 14.46 18.57 36.26 31.25 Northern Cape Operating Unit 7.55 9.64 24.13 22.18 North West Operating Unit 15.52 17.76 36.39 38.72 Western Cape Operating Unit 7.03 10.3 20.53 21.69 Distribution 14.94 19.6 38.29 38.00

2019/10/08 26 Standing Items Renewable Energy

2019/10/08 27 Installed Renewable Energy in the Western

Technology Installed Planned2 Capacity1 Name Location Capacity Grid WIND Bid 1: Connection Roggeveld Laingsburg 140MW 02 Dec 2020 91,6MW Karusa Matjiesfontein 139,8MW 15 March 2021

Bid 2: 232MW Soetwater Matjiesfontein 139,4MW 15 March 2021 Perdekraal Touwsrivier 107,76MW 26 April 2020 East Excelsior Swellendam 31,9MW 27 Oct 2019 Total: 398,6MW

Bid 1: 41MW Power Dispatch SOLAR Bid 2: 17,8MW • All the available power is dispatched as per contract Bid 3: 75MW

Total: 133,8MW

Note 1: All installed during bid 1,2,3 Note 2: New capacity to be installed in bid 4, currently in construction

28 Towards Cleaner Power with Battery Energy Storage Systems (BESS)

29 BESS Project Target Completion

30 Procurement Method Where we are

31 Phase 1 - ECOU; KZNOU and WCOU sites

• Phase 1 is made up of the following sites which make up to 800 MWh

OU Site Name Nature of Solution Integration Type Size of BESS Capacity (MWh) (MW)

EC Melkhout Load levelling and Substation HV 40 160 Generation

KZN Elandskop Load shaving Substation MV 8 32

KZN Pongola Load levelling and Substation HV 40 160 Generation

WC Skaapvlei Generation Smooting Substation without 50 Min 200 Max MV 320

WC Hex Capital deferment Substation without 25 100 MV

WC Paleisheuwel Voltage Response Substation MV 16.5 66 11kV & 22kV 32

WC Voltage Response Substation MV 9 36

Phase 1 - WCOU sites

• Phase 1 is made up of the following sites which make up to 800 MWh

OU Site Name Nature of Solution Integration Type Size of BESS Capacity (MW) (MWh)

WC Nuwekloof Wind Generation Substation HV 9 36 smoothing & Peak shaving

WC Witzenburg Wind Generation Substation HV 25 100 smoothing & Peak shaving

TOTAL 222.5 MW 890 MWh

Final mix of sites to reach 800 MWh will hinge on the capacity constraints of Skaapvlei influenced by environmental considerations and site limitations.

33 Phase 2 - WCOU and ECOU Sites

• Phase 2 is made up of the following sites which make up to 640 MWh OU Site Name Nature of Integration Type Size of Capacity PV Solution BESS (MWh) (MW) (MW)

WC Nuwekloof Peak & volt sup. Substation HV 9 54 0

WC Witzenburg Peak & Volt sup. Substation MV 25 225 0

WC Ashton Peak shaving Substation HV 15 60 0

TOTAL 49 339 0

EC Dorper Peak shav. 40 160 0

Nuwekloof and Witzenburg overlap with Phase 1 projects. The ultimate size and selection will be decided once constraints are known at Skaapvlei site.

34 Standing Items Electrification

2019/10/08 35 Six Year Electrification Gazette per Municipality

2018/19 Actual 2019/20 Planned 2020/21 Planned 2021/22 Planned 2022/23 Planned 2023/24 Planned District Connections Connections Connections Connections Connections Connections

City of Cape Town 5859 5642 3605 2348 3930 8627 West Coast 69 422 270 440 200 200 Cape Winelands 225 482 810 600 800 900 Overberg 2636 2179 1600 2600 1300 2100 Eden 311 475 240 2700 2300 1500

Central Karoo 0 0 0 0 0 0 Total 9100 9200 6525 8688 8530 13327

2018/19 Actual 2019/20 2020/21 2021/22 Planned 2022/23 Planned 2023/24 Planned District CAPEX (March) Planned CAPEX Planned CAPEX CAPEX CAPEX CAPEX

City of Cape Town R 59 613 487 R 39 945 394 R 66 562 359 R 94 158 585 R 96 845 841 R 119 279 000 West Coast R 4 075 384 R 8 828 390 R 4 154 625 R 12 504 030 R 8 664 030 R 8 664 030 Cape Winelands R 6 517 753 R 4 350 269 R 15 435 555 R 8 400 000 R 12 000 000 R 14 400 000 Overberg R 28 338 871 R 24 389 879 R 7 019 635 R 36 400 000 R 19 500 000 R 33 600 000 Eden R 6 523 338 R 7 081 255 R 2 480 000 R 37 800 000 R 34 500 000 R 24 000 000 Central Karoo R 159 R - R - R - R - Total R105 068 992 R84 595 187 R95 652 174 R189 262 615 R171 509 871 R199 943 030

10 Overview of formal versus informal electrification

2019/20 2020/21 2021/22 2023/24 2018/19 Actual 2022/23 Planned Formal/Informal Planned Planned Planned Planned Connections Connections Connections Connections Connections Connections

Formal 4120 4764 3483 5618 6444 7776 In-Formal 4980 4436 3042 3070 2086 5551

Total 9100,00 9200,00 6525,00 8688,00 8530,00 13327,00

Inception to date Formal Informal 248 342 212 231 36 111

 As per definition, there is no formal electrification backlog in the WC (houses built not electrified)  There are 9314 informal dwellings that un-electrifiable. (they are either on privately owned land, wetlands, road or rail reserve, noise corridors etc.)

37 Standing Items Load Curtailment

2019/10/08 38 Top Customer Load Curtailment 39 in the Western Cape

Customer Name Total NMD Load Curtailment (Y/N) Stage 1&2 Stage 3 (15%) Comment (MVA) (10%)

Saldanha Steel 270 Yes Excluded, on 21 35MW DR DMP

Tronox (Smelter, 109.5 Yes 8.76 13.14 All 3 sites curtail BsB & MSP) at Smelter

Astron Energy 24 No, Strategic & Supply diesel to exempted. Ankerlig OCGT

PetroSA 125 No, Strategic & Supply diesel to exempted. Gourikwa OCGT

Transnet Freight Multi Yes, TFR National Rail (Mainline & Traction Curtailment agreement OREX) PODs

PRASA Multi PODs No curtailment Large Power User Load Curtailment in the Western Cape

Customer Name Total NMD Load Stage 1&2 (10%) Stage 3 (15%) Comment (MVA) Curtailment (Y/N) Somerset Mall 10 Yes 1 1.5 1-2 MVA off the demand depending on the stage

2019/10/08 40 Standing Items Update on Ankerlig CCGT

2019/10/08 41 Ankerlig Combined Cycle Gas Turbine (CCGT)

 Phase 1A

 Installation of the dual fuel burners – complete

 Phase 1B

 This is the balance of plant needed to enable the plant to burn natural gas. The project is currently in the definition phase, finalising some basic and detail designs. This scope includes the civil works, gas receiving station, distribution piping, control skids, electrical and control and instrumentation. The next activity on this project is to develop the works information and thereafter the gas supply agreement has been concluded.

 Phase 2

 The scope of work for conversion of the plant to Combined Cycle has been developed up to basic design stage. For this project to progress, Eskom needs a determination from the Department of Energy, a gas supply agreement to be in place that makes economic sense to Eskom, and all the required licenses and permits issued.

42 Thank you