Contact information Telephone Websites and email Eskom head offi ce: +27 11 800 8111 Eskom website: www.eskom.co.za Eskom Group Communications: +27 11 800 2323 Eskom environmental: [email protected] Eskom Development Foundation: +27 11 800 2758 Eskom annual report: www.eskom.co.za/annreport09/ Eskom Development Foundation: www.eskom.co.za/csi Ethics offi ce advisory service: +27 11 800 2791/3187 or [email protected] Confi dential fax line: +27 11 507 6358 Physical address Postal address Eskom Eskom Megawatt Park PO Box 1091 Maxwell Drive Johannesburg Annual Report 2009 Sunninghill 2000 Annual ReportAnnual 2009 Sandton 2157 Eskom Holdings Secretariat N Msomi (Company Secretary) Megawatt Park PO Box 1091 Johannesburg 2000 www.eskom.co.za Empowering the South African dream BASTION GRAPHICS Artist’s impression of the new Moses Mabhida Stadium courtesy of Mediaclubsouthafrica.com Contact information Telephone Websites and email Eskom head offi ce: +27 11 800 8111 Eskom website: www.eskom.co.za Eskom Group Communications: +27 11 800 2323 Eskom environmental: [email protected] Eskom Development Foundation: +27 11 800 2758 Eskom annual report: www.eskom.co.za/annreport09/ Eskom Development Foundation: www.eskom.co.za/csi Ethics offi ce advisory service: +27 11 800 2791/3187 or [email protected] Confi dential fax line: +27 11 507 6358 Physical address Postal address Eskom Eskom Megawatt Park PO Box 1091 Maxwell Drive Johannesburg Annual Report 2009 Sunninghill 2000 Annual ReportAnnual 2009 Sandton 2157 Eskom Holdings Secretariat N Msomi (Company Secretary) Megawatt Park PO Box 1091 Johannesburg 2000 www.eskom.co.za Empowering the South African dream BASTION GRAPHICS Artist’s impression of the new Moses Mabhida Stadium courtesy of Mediaclubsouthafrica.com Contents Southern Africa grid map Flap Profi le 68 Responding to climate change 68 Performance IFC Southern Africa grid map 69 Diversifi cation of the energy mix i Profi le 70 Energy effi ciency measures iii Key facts 70 Adaptation to the negative impacts of climate vi How is electricity generated? change vii Electricity: from power station to customer 71 Innovation through research, demonstration x Executive summary and development xx Organisational structure 74 Investment through the carbon market 2 Vision, values and strategic objectives 74 Progress through communication and advocacy 4 Group fi ve-year review 75 Planning and decision-making 6 Chairman and chief executive 77 Limiting the impact on the environment 78 Performance 8 Message from the chairman 80 Air quality 12 Board of directors 82 Water usage 14 Message from the chief executive 84 Compliance with environmental legislation Beira 20 Executive management committee 84 Biodiversity Bulawayo 330kV 22 Market and industry overview 85 Waste Namibia 87 Environmental management systems Zimbabwe Pande Gas Fields 24 Business and sustainability performance review 87 Environmental expenditure 88 Restoring Eskom’s image and public confi dence Serule Temane Gas Fields 26 Sustainability 89 Stakeholder engagement Mozambique Windhoek Massingir 27 Integrated risk management 90 Customer satisfaction Walvis Bay Morupule 30 Performance in terms of the shareholder 92 Our people Botswana Polokwane compact 533kV DC 92 Skills 400kV 32 Financial review 94 Employment equity Matimba Inhambane 32 Financial performance overview 95 Electricity distribution industry restructuring 132kV 220kV Lephalale Corumana 37 Achieving the requested price increases 95 Safety Gaborone Pretoria Tubatse Xai-Xai 400kV 132kV 220kV Arnot 38 Capital and funding strategies 101 Independent assurance report on sustainability Kusile 132kV Maputo 39 Procurement and supply chain performance 765kV Witbank Selomo Johannesburg Ermelo 40 Information technology 104 Consolidated group annual fi nancial statements Edvalein II 40 Productivity performance Luderitz Bethal 106 Statement of responsibilities and approval Balfour 42 Contribution to society 400kV Grootvlei Swaziland 42 In support of government initiatives 107 Report of the audit committee 400kV 44 Corporate social investment 107 Statement by company secretary Kudu 400kV 765kV 45 Securing continuity of supply 108 Independent auditors’ report to the 400kV Drakensberg 45 System recovery Minister of Public Enterprises Kimberley 765kV Richards Bay 48 Demand-side management 109 Directors’ report Bloemfontein 52 Powering the 2010 World Cup 112 Consolidated fi nancial statements 400kV Lesotho 53 Technical performance 112 Balance sheets South Africa Durban 53 Generation plant performance 113 Income statements 765kV 54 Transmission system performance 114 Statements of changes in equity Vanderkloof 400kV 55 Distribution network interruption 116 Cash fl ow statements performance 118 Notes to the fi nancial statements Gariep 56 Primary energy 214 Corporate governance and tables Ankerlig 56 Coal 765kV 58 Liquid fuels 216 Corporate governance Koeberg Klipheuwel 224 Tables East London 59 Nuclear fuel Acacia Port Rex 59 Executing the build programme 224 Statistical overview Gourikwa 226 Power station capacities Cape Town Port Elizabeth 60 Integrated strategic electricity planning Palmiet Mossel Bay 61 Investment portfolio 227 Environmental implications of using/saving one 62 Status of the build programme kilowatt-hour of electricity 65 Environmental impact assessments 227 Transmission and distribution equipment 66 Power purchase programmes in service 67 Nuclear 228 Sale of electricity and revenue per category of customer 229 Awards FutureFt pumped d storage t station tti 231 Glossary Key Coal-fi red power station 233 Abbreviations and acronyms Existing grid system 235 GRI index Future interconnection substation 237 Eskom annual report survey Possible future grid system Nuclear power station IBC Contact information Future hydroelectric power station Pumped storage station Future coal-fi red power station Gas power station Hydroelectric power station Renewable energy Stakeholder comment Interconnection substation To w n Future gas station Research block www.eskom.co.zaw Information block WhereverW this symbol is present please The map indicates the South African power network and some interconnections with neighbouring countries. referr to the web site for more information. Education block Contents Southern Africa grid map Flap Profi le 68 Responding to climate change 68 Performance IFC Southern Africa grid map 69 Diversifi cation of the energy mix i Profi le 70 Energy effi ciency measures iii Key facts 70 Adaptation to the negative impacts of climate vi How is electricity generated? change vii Electricity: from power station to customer 71 Innovation through research, demonstration x Executive summary and development xx Organisational structure 74 Investment through the carbon market 2 Vision, values and strategic objectives 74 Progress through communication and advocacy 4 Group fi ve-year review 75 Planning and decision-making 6 Chairman and chief executive 77 Limiting the impact on the environment 78 Performance 8 Message from the chairman 80 Air quality 12 Board of directors 82 Water usage 14 Message from the chief executive 84 Compliance with environmental legislation Beira 20 Executive management committee 84 Biodiversity Bulawayo 330kV 22 Market and industry overview 85 Waste Namibia 87 Environmental management systems Zimbabwe Pande Gas Fields 24 Business and sustainability performance review 87 Environmental expenditure 88 Restoring Eskom’s image and public confi dence Serule Temane Gas Fields 26 Sustainability 89 Stakeholder engagement Mozambique Windhoek Massingir 27 Integrated risk management 90 Customer satisfaction Walvis Bay Morupule 30 Performance in terms of the shareholder 92 Our people Botswana Polokwane compact 533kV DC 92 Skills 400kV 32 Financial review 94 Employment equity Matimba Inhambane 32 Financial performance overview 95 Electricity distribution industry restructuring 132kV 220kV Lephalale Corumana 37 Achieving the requested price increases 95 Safety Gaborone Pretoria Tubatse Xai-Xai 400kV 132kV 220kV Arnot 38 Capital and funding strategies 101 Independent assurance report on sustainability Kusile 132kV Maputo 39 Procurement and supply chain performance 765kV Witbank Selomo Johannesburg Ermelo 40 Information technology 104 Consolidated group annual fi nancial statements Edvalein II 40 Productivity performance Luderitz Bethal 106 Statement of responsibilities and approval Balfour 42 Contribution to society 400kV Grootvlei Swaziland 42 In support of government initiatives 107 Report of the audit committee 400kV 44 Corporate social investment 107 Statement by company secretary Kudu 400kV 765kV 45 Securing continuity of supply 108 Independent auditors’ report to the 400kV Drakensberg 45 System recovery Minister of Public Enterprises Kimberley 765kV Richards Bay 48 Demand-side management 109 Directors’ report Bloemfontein 52 Powering the 2010 World Cup 112 Consolidated fi nancial statements 400kV Lesotho 53 Technical performance 112 Balance sheets South Africa Durban 53 Generation plant performance 113 Income statements 765kV 54 Transmission system performance 114 Statements of changes in equity Vanderkloof 400kV 55 Distribution network interruption 116 Cash fl ow statements performance 118 Notes to the fi nancial statements Gariep 56 Primary energy 214 Corporate governance and tables Ankerlig 56 Coal 765kV 58 Liquid fuels 216 Corporate governance Koeberg Klipheuwel 224 Tables East London 59 Nuclear fuel Acacia Port Rex 59 Executing the build programme 224 Statistical overview Gourikwa 226 Power station capacities