South Africa’s 14,218 km electricity line problem

South Africa will have to build 14,218 km of transmission lines within the next decade, which will cost the country around R350 billion. 

This was revealed by the German consultancy group VGBE Energy, which the National Treasury commissioned to analyse the performance of Eskom’s coal-fired power plants and recommend how they can be improved. 

The German engineers with extensive experience running coal-fired power plants spent four and a half months studying South Africa’s ailing power utility. 

Apart from touring Eskom’s coal power stations, one by one, the VGBE team also conducted a study of the company’s transmission grid and the significant changes that need to be made to it in the coming decade. 

They said the Eskom transmission grid faces several challenges, the largest being the location of current generation facilities and the changes that must be made to accommodate renewable energy. 

The bulk of the generation capacity, currently coal power plants, is in the northeast region, which is historically closest to the largest load centre in Gauteng and the country’s coal reserves. 

However, that does not correspond to the best places for renewable generation in South Africa since their potential is in the southwest part of the country, in the Cape provinces. 

To resolve this and ‘flip’ the country’s transmission grid, 14,218 km of new transmission lines must be built by the end of 2032. 

This task is extremely challenging for Eskom and the government, and it is made even more difficult by the lack of funding for such a building programme and the lack of manufacturing capacity to build the lines. 

To complete the necessary transmission lines, Eskom and the National Transmission Company will have to build 1,400 km of lines each year. 

However, Eskom only has the budget to build 166 km in the 2024 financial year, 186 km in the 2025 financial year, and 489 km in the 2026 financial year. 

Currently, the country can only manufacture 400 km of transmission lines and has never produced more than 1,200 km in a single year. 

The maximum length of transmission lines built annually was 1,800 km in the 1990s. 

The graph below shows the length of transmission lines that need to be built annually by 2032 for the country to effectively flip its grid around, according to the government’s two latest Transmission Development Plans.

Money is not a problem

Board member of the new National Transmission Company, Professor Mark Swilling, said South Africa’s biggest challenge is not money, as the private sector is willing to invest heavily in upgrading and expanding the country’s grid. 

The biggest challenge is the country’s lack of skills, manufacturing capacity, and the institutional arrangements needed to blend private and public funding. 

Even if the private sector invested billions of rands in upgrading the country’s grid, which it can do, South Africa will still have a capacity problem. 

A major contributing factor to the country’s lack of capacity is the stop-start nature of the government’s grid expansion policy, which is scaring off investors. 

This uncertainty prevents local and international manufacturers from investing in increasing local capacity. 

Electricity Minister Kgosientsho Ramokgopa hosted a seminar with the JSE last week to discuss private funding of Eskom’s transmission development plan. 

The private sector reiterated its commitment to helping the government address the country’s grid capacity constraints. 

After the seminar, Ramokgopa will present a report to the Cabinet on how the country’s grid should be expanded and upgraded.