Eskom worried about low-quality coal

[] — Eskom has expressed concern on Monday over the quality of coal it receives from domestic suppliers, which might affect the operations of its coal-fired plants.

Dan Marokane, Eskom’s executive for primary energy division, said the quality of coal supplied to Eskom was not as high a grade as that exported by the country’s producers.

“The (coal) export demand influences not only the availability of coal but could also have an undesired effect on overall electricity prices,” Marokane said in a statement, but did not give any details.

South African miner Exxaro, Anglo American’s South African coal unit and Optimum Coal Holdings Ltd are some of Eskom’s coal suppliers.

Coal suppliers have said they provide high-grade coal to Eskom and that the coal shipped abroad was different from the coal supplied to the power utility.

The power utility said it was willing to discuss with suppliers issues related to procurement to make improvements and also said it planned to use railway transport more than roads to deliver coal to its power stations to minimise damage to road infrastructure.

Analysts have said the company may face hurdles in shipping coal by rail due to limited capacity on the country’s railway line infrastructure. Lack of sufficient rail capacity has already capped coal exports.