Abstract:
Eskom has embarked on the construction of two
coal-fired power stations (Medupi and Kusile) that
use a new dry-cooling process with flue gas desulphurisation
(FGD). While the introduction of these
new technologies does have meaningful environmental
benefits beyond the conventional coal-fired
power stations, they still emit greenhouse gasses.
The question at stake here is what is the opportunity
cost, viewed from a climate change perspective,
of these two new power stations? This question is
answered by considering the carbon footprint of the
two power stations and a range of unit values for
CO2. From this analysis, it is evident that the most
likely range of the opportunity cost is between R6.3
billion and R10.7 billion per year. This converts to
a damage cost of between R0.10 and R0.17/kWh
when assuming a net combined generation capacity
of 8 677 MW and a load factor of 85%.
