EE BUSINESS INTELLIGENCE ANALYSIS: Diesel or Darkness: PetroSA charges Eskom unfair prices, extracts upfront payments

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Eskom has been forced to pay exorbitant prices for diesel it buys in bulk from PetroSA, the financially distressed state-owned entity which is its main diesel supplier, even as the utility battles in vain to stave off worsening stages of load shedding.

The diesel is needed to power Eskom’s two open-cycle gas turbine power plants, Gourikwa and Ankerlig, which are effectively its emergency backup generators that can mitigate against two stages of load shedding if running at the full output of 2,067MW.

With no funds forthcoming from government, Eskom capitulated and somehow managed to scrape together funds from savings in capital and operational expenditure for a first emergency procurement of diesel in late November 2022 from stock held by PetroSA. Then on 23 January 2023, the purchase of a third tranche of R1.5-billion worth of diesel was approved by the Eskom board, which Eskom has since begun burning. This was originally expected to last until the middle of February 2023, but at the current high burn rate, it will run out much sooner.Eskom’s data portal shows that the load factor for its two OCGTs was nearly 50% on 31 January 2023, compared with an average of about 16% for the financial year prior to that date.

However, Eskom has resisted these suggestions, as these apparent opportunistic diesel suppliers were all offering diesel prices at just slightly below those being received from PetroSA, which indicated possible collusion and anti-competitive behaviour. However, Mantu did indicate in the DPE response received on 20 January 2023 that “DPE is actively prospecting and engaging diesel suppliers to expand Eskom sources of diesel and ensure that Eskom gets diesel at competitive prices in order to realise cost saving for Eskom”.

 

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South Africans stealing from South Africans.

Eskom mustn’t ask for sympathy. Have you ever tried ti do a cost to company to procure generator’s add diesel to that on top of an electricity bill and where does that leave you. You cry for increases in salary and job creation. We get middle finger is all

Speculation is only needed if it suits your narrative better than the actual facts. The reason Eskom’s DMRE application was denied is public knowledge. Seems investigative only has meaning when it relates to Zuma.

Surely your friends who are diesel suppliers are no longer benefitting.

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