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Eskom splurges on diesel to keep loadshedding at bay

Luis Monzon

10th August 2023

In order to better manage loadshedding, Eskom has increased its purchasing and burning of diesel in its open cycle turbines.
From April to July 2023 the utility spent R12 billion in taxpayer money to keep loadshedding from reaching higher stages.
In July the utility was cleared to receive a loan of R184 billion from National Treasury.

Before the winter period began, Eskom issued a grim warning to South Africans that increased demand, which is usually seen during the months of June, July and August, could lead to Stage 8 loadshedding. Despite this, the winter months never reached the milestone, and instead, we saw Stage 6 loadshedding for a few weeks in July.

Eskom says it managed this by increasing the renewable energy that it was generating, as well as reducing maintenance at its power stations. It also burnt significant amount of diesel in its open-cycle gas turbines (OCGTs). These are power generating units, basically giant fuel generators that are only supposed to be used during emergencies or at peak periods – that is of course, in a perfect world without loadshedding.

According to data from The Outlier, citing Eskom’s financials from 1st April 2023 to 24th July 2023, the utility spent R12 billion in buying diesel to keep its OCGTs running. In the 2022/2023 financial year, Eskom reported that it generated 3 018 gigawatt hours (GW/h) of electricity from these generators.

This marks an increase over the 1 826GW/h it generated in the 2021/2022 financial year, owing to the worsening of the energy crisis over 2022 and especially in its last few months.

In the months of April, May, June and July 2023, Eskom spent R3 billion per month on just diesel for its OCGTs. With 2022’s total spending on diesel at R21 billion, the utility seems well on the way to make 2023 a record year in terms of diesel purchases.

Eskom’s spending on OCGT diesel over the years. Image sourced from The Outlier.

The R3 billion spent on diesel so far is dwarfed by the R184 billion in taxpayer money the utility received from the National Treasury in loans, which are expected to continue into 2025. This massive lump of change came as part of the Eskom Debt Relief Bill, signed into law by President Cyril Ramaphosa in July.

In the 2023/2024 financial year Eskom is set to rake in R78 billion from government as part of debt relief efforts.

On Women’s Day, 9th August 2023, Eskom was able to suspend loadshedding for some of the day. It used eight OCGTs to combat a demand of 30 299, according to its latest X update.