FACULTY OF BUSINESS & MANAGEMENT SCIENCES Department of Operations Management OPERATIONS MANANGEMENT 2 (PRB260S) CASE STUDY What is load shedding? As South Africa's primary electricity supplier, Eskom's mandate is to ensure security of supply to service the South African economy and society. Eskom's nominal generating capacity is around 44,000 MW. The total net output, excluding the power consumed by their auxiliaries and generators currently in reserve storage, is 40527. Eskom therefore generates, transports and distributes electricity - and this is managed predominantly by Eskom for the entire country; however, Eskom only directly supplies more than 5 million households which means that most of us are supplied by municipalities. At all times there must be sufficient supply to meet demand, but electricity demand is not consistent because of: peak periods when demand is higher and continuous growth in the number of customers requiring electricity services. This means that the power system requires constant and prudent management of supply to meet demand but, today, Eskom faces the challenge of a constrained power system that will affect us until substantial new power capacity is available. In the meantime, to meet demand, our older power stations and infrastructure are being used to full capacity. In addition, routine and necessary maintenance of plant and infrastructure is carefully scheduled to limit compromising supply capacity during periods of high demand. We have also strengthened the distribution network to reduce the incidence of localised outages when the power trips because of overload in local areas such as suburbs. Localised outages should not be confused with load shedding. Local outages can occur when there is either a technical fault in the transmission or distribution network, or when electricity equipment has been tampered with such as theft of cables, or when there is an overload of the local system because of irregular high usage due to electricity theft as well as normal faults. Load shedding, or load reduction, is done countrywide as a controlled option to respond to unplanned events to protect the electricity power system from a total blackout. While we generally use the word blackout loosely to mean "no lights" in our local area, a country-wide blackout has much more serious consequences, which can occur when there is too much demand and too little supply, bringing the power system into an imbalance - tripping the power system in its entirety. Many countries and cities in other parts of the world have experienced complete blackouts. To restart their system, they are able to tap into a power system from a neighbour which can take a few hours or days, but we have to rely on ourselves to start the system from scratch - energising one power plant at a time and one section of the country at a time. It could take up to two weeks to restore full power, which would have a severe impact on our country! This is why we use load shedding, or load reduction, to effectively manage our power system and assist in protecting it from such an event. Eskom's Load Shedding Protocols Keeping the power system balanced at 50Hz, as per international standards, is critical to prevent a nationwide blackout and when the national electricity grid is under pressure with normal measures implemented, Eskom must reduce demand, as agreed with the National Energy Regulator (NERSA), and implements a process of Load Reduction which has two components: 1. Load Curtailment. Our agreement with some of our large industrial customers means we can instruct them to reduce electricity consumption when it is urgent to balance the system. They are able to reduce their load by up to 20%, significantly easing capacity on the grid; but it takes a minimum of 2 hours to implement. 2. Load Shedding. If, after Load Curtailment, the demand on the system is still greater than available supply, we have to implement a process of load shedding to prevent an imbalance and subsequent blackout. Load shedding will also be implemented if there is insufficient time to request load curtailment; and in winter load shedding can be implemented before curtailment due to the peaky nature of the problem. Plagued by power cuts and with its infrastructure in desperate need of revamping, South Africa's struggling state power utility Eskom says the country desperately needs an additional 5,000 megawatts (MW) of generating capacity. Eskom's load-shedding stage definitions Eskom explains the different load-shedding stages on its website and in the documentation it provides to the public and municipalities. Here are the current load-shedding definitions for Stage 1 to Stage 8. Stage 1 allows for up to 1,000 MW of the national load to be shed. Stage 2 allows for up to 2,000 MW of the national load to be shed. Stage 3 allows for up to 3,000 MW of the national load to be shed. Stage 4 allows for up to 4,000 MW of the national load to be shed. Stage 5 allows for up to 5,000 MW of the national load to be shed. Stage 6 allows for up to 6,000 MW of the national load to be shed. Stage 7 allows for up to 7,000 MW of the national load to be shed. Stage 8 allows for up to 8,000 MW of the national load to be shed. Sources: 1. https://loadshedding.eskom.co.za/LoadShedding/Description 2. https://www.eskom.co.za/OurCompany/SustainableDevelopment/ClimateChangeCOP17/Documents/Gener ationMix.pdf QUESTIONS After Carefully reading the text, answer the questions below: 1. Define design and effective capacity and give an example in case. 2. What is Eskom's design capacity? 3. What is Eskom's effective capacity? 4. Give three examples of Eskom's actual output. 5. Calculate Eskom's Utilizationswhen Load shedding is at Stage 1, Stage 3 and stage 8. What conclusion can you make? 6. Calculate Eskom's efficiency when Load shedding is at Stage 1, Stage 3 and stage 8. What conclusion can you make? 7. What are the consequences of having Load shedding in a country like South Africa? 8. Give at least 5 recommendations that can help Eskom to avoid the risk load shedding.