Eskom Generation Fleet Renewal Project: Socio-Economic Study

Eskom GenerationFleet Renewal Project:Socio-Economic Study

Report Prepared for

Eskom

Report Number 506503/F1

Report Prepared by

February 2017

SRK Consulting: Project No: 506503 Socio-Economic Study Page i

BRAV/MALA/HARA/BRAN/MAVA FINAL SIA Report_Eskom_srk_506503_03022017 February 2017

Eskom Generation Fleet Renewal Project: Socio-Economic Study

Eskom

SRK Consulting (South Africa) (Pty) Ltd 265 Oxford Rd Illovo 2196 Johannesburg South Africa

e-mail: [email protected] website: www.srk.co.za

Tel: +27 (0) 11 441 1111 Fax: +27 (0) 11 880 8086

SRK Project Number 506503

February 2017

Compiled by: Peer Reviewed by:

Victoria Braham Social Scientist

Adel Malebana Senior Social Scientist

Anita Bron Principal Social Scientist

Vassie Maharaj Partner

Email: [email protected]

Authors (in alphabetical order):

Victoria Braham, Anita Bron, Andrew Hart, Adel Malebana, Sue Reuther

Victoria Braham Anita Bron

Adel Malebana Vassie Maharaj

[email protected]

Victoria Braham, Anita Bron, Andrew Hart, Adel Malebana, Sue Reuther

SRK Consulting: Project No: 506503 Socio-Economic Study Page ii


Executive Summary Eskom owns and operates fourteen coal-fired power stations in South Africa, and is responsible for

generation, transmission and distribution of electricity to South Africa. The majority of Eskom power

stations are nearing their end of life, and Eskom has commenced with studies to assess fleet

renewal options for dealing with these power stations.

The power stations under discussion in this study are Hendrina, Arnot and Komati in the Steve

Tshwete Local Municipality, as well as Camden power station in the Msukaligwa Local Municipality.

These power stations are situated in the Mpumalanga Province. All these power stations use coal,

sourced from local mines, for the generation of electricity. The result is that electricity generation

has been widely associated with the emissions of carbon dioxide (CO2), sulphur dioxide (SO2) and

nitrogen dioxide (NO2), which contribute to health related issues at local level, and climate change

impacts on a broader scale.

Eskom has identified four fleet renewal options that could be implemented at these four power

stations. The options are classified as follows:

Option 1A/1B, referred to as Option 1 in this report (506503/F1): Lifex and Modernisation

(Refurbishment);

Option 2, which according to technical studies, was not considered technically feasible and was

therefore not assessed as part of this study: Repower with Biomass or Gas;

Option 3A/3B, referred to as Option 3 in this report (506503/F1): Rebuild as Pulverized Fuel or

Circulating Fluidised Bed Combustion (Demolish and rebuild); and,

Option 4: Do not renew (Decommission).

Overall, Eskom seeks to ensure that the chosen fleet renewal option cost effectively contributes to

meeting the electricity demand in South Africa, thereby generating further revenue from electricity

sales. In order to assist Eskom in selecting the option that will best meet their objective, the key

objectives that the socio-economic study aim to fulfil were:

Undertake a baseline study/overview of the project’s zones of influence to understand the socio-

economic landscape locally, regionally and nationally;

Assess the socio-economic implications of the proposed project options and associated

infrastructure per power station;

Identify stakeholder issues, opportunities, potential socio-economic impacts and risks, and

areas that would require mitigation for the options;

Assess the resilience/vulnerability of the communities in the context of the options and how they

would respond to these options;

Place the socio-economic considerations of the local communities into the broader context of

national priorities and sustainable development goals (social, economic and environment);

Rate and rank the three options in light of the above information; and,

Assess the socio-economic risks of the project.

To meet the socio-economic study objectives, five components to the socio-economic study were

identified:

1. Macro-economic and socio-economic baseline analysis;

2. Identification of applicable national priorities and sustainable development goals;

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3. Stakeholder analysis;

4. Assessment of impacts of the options by way of an options analysis; and,

5. Risk assessment.

The study components were informed by the application of the following methods:

Desktop review: the review of current and available secondary data sources.

Interviews with internal and external stakeholders: key informants included internal

corporate stakeholders, internal power station stakeholders, and selected external

stakeholders.

Regarding component 1 (Macro-economic and socio-economic baseline analysis), key social and

economic characteristics at play in the municipalities within which the power stations are situated

included:

There are high levels of poverty and high unemployment rates, which are associated with low

incomes for those employed;

The local and regional economy is mostly based on manufacturing, energy, mining and trade;

Across the regional zone of influence, the majority of the population is of working age and below

the ages of 35, with a high dependency rate associated with a significant youthful population

below 18 years old;

The region experiences population increases due to in-migration from within the province and

the rest of the country. Linked to this is the growth of informal settlements and the demand for

services;

Levels of education in the local zone of influence are high, however the number of those having

attained tertiary education is low and can be attributed to (amongst other reasons) lack of tertiary

education campuses in the municipalities as well as financial constraints presented by attending

tertiary institutes;

Access to health care facilities is low, with Camden power station being the only one with a

hospital within a 20km radius. The rest of the hospitals are between 40km and 53km radius of

the power stations; and,

Apart from Camden power station, all the power stations, (through the local municipality),

provide potable water, sanitation and electricity to their zones of influence.

In terms of component 2 (Identification of applicable national priorities and sustainable development

goals), as a state-owned enterprise Eskom needs to align its activities with those of government in

order to contribute towards government reaching its development targets. With the adoption of the

National Development Priorities and the associated Sustainable Development Goals, Eskom is

required to limit the emissions from their operations in an attempt to respond to national priorities.

As such, options were assessed against national priorities to determine the extent to which they

were synergistic or conflicting with the identified priorities and goals. The National Development

Plan priorities identified as most relevant to this study were therefore: social, economic, and

environmental, linking to the following Sustainable Development Goals: Goal 1 “End poverty”, Goal

4 “Inclusive and equitable quality education”, Goal 3 “Ensure healthy lives and promote well-being

for all”, and Goal 9 “Build resilient infrastructure”.

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Regarding component 3 (Stakeholder analysis), key stakeholders identified included:

Government, (national, provincial, district and local);

Host communities;

Competent and commenting authorities;

Neighbouring mines;

Non-Governmental Organisations,

Business forums;

Transportation forums;

Internal stakeholders; and,

Neighbouring farmers.

The high-level stakeholder analysis indicated similar stakeholder relationships and patterns

amongst the four power stations. Stakeholder forums were identified across all four power stations,

with forums representative of adjacent farmers, municipalities and receiving communities. All the

power stations indicated having continuous engagement with their stakeholders through these

forums. However, in terms of engagement with non-government organisations, Camden power

station was not strong when compared to other power stations.

In terms of component 4 (Assessment of impacts of the options by way of an options analysis) an

option analysis was used to identify and assess the potential changes and impacts of each of the

three options for each power station, in order to identify a preferred option. Seven impact categories

were identified, These were further broken down into nineteen impact sub-categories. A basic

decision matrix was developed, consisting of a set of weighted criteria to rate the options against.

The seven impact categories were:

Employment and procurement;

Environmental;

Corporate social investment and training;

Service delivery;

Coal sourcing;

Land take; and,

Regional and national economic contribution impacts.

The findings of this option analysis for all the four power stations were:

Options 1 and 3 were the preferred options in that their implementation would lead to continued

maintenance of current employment, as well as creating new employment opportunities into the

future. Both options would allow for the continuation of the Corporate Social Investment spend

through the Eskom Foundation, thus providing the beneficiaries with skills to increase their

employability, as well as access to other livelihoods opportunities such as small businesses.

However, from an environmental point of view, these two options differed in that Option 1 would

continue to use more water due to its wet cooling system, while Option 3 would be using a dry

cooling system. Both options however reduced the emissions of CO2, SO2 and NO2 due to the

installation of Flue Gas Desulphurisation.

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From a land take point of view, Option 1 was the most preferred option in that it would not require

additional land, whereas Option 3 would require additional land for ash storage and limestone

and gypsum quarrying.

In terms of the relationship between the power station and the communities, Options 1 and 3

were less likely to result in community dissatisfactions that would normally occur during job

losses associated with decommissioning. However, regarding Option 4, Camden and Komati

power stations were previously mothballed and later returned to service. As a result, the power

stations and communities had dealt with the impacts of decommissioning previously, and would

more likely be able to handle these impacts should Option 4 be implemented.

Having recommended Options 1 and 3 as the preferred options for each of the power station, a

rapid vulnerability assessment of the local communities was developed in order to assess the

community response to these options and how adaptive they would be to these changes. Across all

four power stations, it was found that the communities’ adaptive capacity was low to moderate,

based on their ability to cope relevant to current and future stresses, future impacts and access to

social capital and resources.

Component 5 comprised of a risk assessment to understand the threats and/or opportunities of

implementing any of the three options. The following key findings were made:

The threats that were identified and assessed per option were related to potential economic and

physical displacement, community and employees grievances, communication with

stakeholders, and continued dependency of the communities on Eskom for service delivery,

health impacts and continued CO2 emissions.

The opportunities for Options 1 and 3 were rated in accordance with maintenance of current

employment, extension of the life of the operation, development of small businesses as a result

of continued Corporate Social Investment and procurement. For Option 4, reduced health and

safety liability, sale of components and handing over of services to local municipalities were

identified as opportunities.

From an economic and social point of view, the highest threat remained the loss of direct and

indirect employment due to the implementation of Option 4 (Decommissioning). However, this

was balanced by the opportunity for improved health and safety impacts due to decreased air

emissions, dust, water contamination and other environmental and socio-economic impacts.

For Options 1 and 3, physical and economic displacement, as well as continued dependence

on Eskom to provide municipal infrastructure to local communities were identified as significant

risks.

SRK recommended that other studies, i.e. financial, engineering and technical studies, inform the

final decision regarding a preferred option. This was due to the absence of a resolute socio-

economic difference between Option 1 and Option 3.

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Table of Contents Executive Summary ................................................................................................................................. ii

Disclaimer ................................................................................................................................................ x

List of Abbreviations ................................................................................................................................ xi

1 Introduction ............................................................................................................... 1

Background ..................................................................................................................................... 1

Overview of Renewal Options ......................................................................................................... 2

Socio-Economic Study Objectives .................................................................................................. 4

Scope of the Report ........................................................................................................................ 5

Methodology.................................................................................................................................... 6

Limitations ....................................................................................................................................... 6

2 Macro-Economic Baseline Analysis ........................................................................ 7

Energy Generation, Enabling Economic Activity and Development ............................................... 7

2.1.1 Importance and Role of Energy .......................................................................................... 7

2.1.2 Contribution by Eskom to the South African Economy ....................................................... 8

2.1.3 Costs to the South African Economy Associated with Coal-based Energy ........................ 9

Contribution to State Revenue through Taxation............................................................................ 9

Employment and Skills Development ........................................................................................... 10

Enabling and Driving Social Development and Transformation ................................................... 11

2.4.1 Role of Energy in Human Development ............................................................................ 11

2.4.2 Contribution by Eskom to South African Electrification ..................................................... 12

2.4.3 Contribution by Eskom to Transformation and Economic Empowerment ........................ 12

2.4.4 Community Development and Funding of CSI Programmes ............................................ 13

2.4.5 Regional/Local Perspective ............................................................................................... 13

Economic Implications of Decommissioning Power Stations ....................................................... 14

2.5.1 Continued Operation ......................................................................................................... 14

2.5.2 Decommissioning .............................................................................................................. 14

Opportunities for Enhancement .................................................................................................... 16

3 Socio-Economic Baseline Analysis ....................................................................... 17

Provincial Context Summary ......................................................................................................... 17

3.1.1 Demographic Overview ..................................................................................................... 18

3.1.2 Provincial Economy ........................................................................................................... 18

Regional Context .......................................................................................................................... 20

3.2.1 Introduction ........................................................................................................................ 20

3.2.2 Summary of Baseline ........................................................................................................ 20

Local ZoI Context .......................................................................................................................... 22

3.3.1 Hendrina ZoI ...................................................................................................................... 23

3.3.2 Arnot ZoI ............................................................................................................................ 24

3.3.3 Komati ZoI ......................................................................................................................... 26

3.3.4 Camden ZoI ....................................................................................................................... 27

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Relevant Strategies and Plans ..................................................................................................... 31

3.4.1 Eskom’s SED and CSI Plans ............................................................................................ 31

3.4.2 Municipalities’ Local Economic Development ................................................................... 32

3.4.3 Provincial Growth and Development Strategy .................................................................. 37

3.4.4 NDP Priorities and SDGs .................................................................................................. 37

4 Stakeholder Analysis .............................................................................................. 39

Stakeholder Profiling ..................................................................................................................... 39

Stakeholder Issues ....................................................................................................................... 43

5 Impact Assessment and Options Analysis ........................................................... 45

Hendrina Power Station ................................................................................................................ 47

Arnot Power Station ...................................................................................................................... 51

Komati Power Station ................................................................................................................... 54

Camden Power Station ................................................................................................................. 57

Rapid Vulnerability/Self-sustenance Assessment of Local ZoI .................................................... 60

5.5.1 Hendrina Power Station .................................................................................................... 60

5.5.2 Arnot Power Station .......................................................................................................... 61

5.5.3 Komati Power Station ........................................................................................................ 61

5.5.4 Camden Power Station ..................................................................................................... 62

6 Risk Assessment ..................................................................................................... 63

Risk Assessment Matrix Development ......................................................................................... 63

Risk Assessment .......................................................................................................................... 63

7 Conclusions and Recommendations .................................................................... 66

Conclusions and Recommendations per Focus Area of Study .................................................... 66

Response to Socio-Economic Consequences: Mitigation and Enhancement Measures ............. 71

Improving the Sustainability of the SED/CSI Initiatives ................................................................ 75

8 Sources Consulted .................................................................................................. 76

Appendices ................................................................................................................... 79

Appendix A: Interview Schedules ............................................................................. 80

Appendix B: Discussion Guides ............................................................................... 85

Appendix C: Regional Context .................................................................................. 86

Appendix D: Local Context ...................................................................................... 103

Appendix E: Options Analysis ................................................................................ 133

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List of Tables Table 2-1: Employees in State Owned Enterprises in 2010 ................................................................... 10

Table 2-2: Key economic sectors of the Steve Tshwete Local Municipality ........................................... 13

Table 3-1: Population structure of the Mpumalanga Province ................................................................ 18

Table 3-2: Socio-economic summary of the four local ZoIs .................................................................... 29

Table 3-3: Relevant NDP priorities and SDGs ........................................................................................ 38

Table 4-1: Stakeholder engagement protocol ......................................................................................... 40

Table 5-1: Rating definitions.................................................................................................................... 45

Table 5-2: Weighting multiplied by rating scores .................................................................................... 45

Table 5-3: Final score definition .............................................................................................................. 46

Table 5-4: Hendrina power station options analysis ............................................................................... 48

Table 5-5: Arnot power station options analysis ..................................................................................... 51

Table 5-6: Komati power station options analysis ................................................................................... 54

Table 5-7: Camden power station options analysis ................................................................................ 57

Table 6-1: Threat risk rating .................................................................................................................... 63

Table 6-2: Opportunity risk rating ............................................................................................................ 63

Table 6-3: Risk analysis .......................................................................................................................... 64

Table 7-1: Conclusions and recommendations per study component .................................................... 67

Table 7-2: Mitigation and enhancement measures ................................................................................. 72

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List of Figures Figure 1-1: Location of Arnot, Hendrina, Komati and Camden power stations .......................................... 1

Figure 1-2: Power station renewal options ................................................................................................. 3

Figure 1-3: Study components ................................................................................................................... 6

Figure 2-1: Electricity consumption by different sectors in South Africa .................................................... 8

Figure 2-2: Human Development Index versus electrification rates......................................................... 11

Figure 3-1: Social issues .......................................................................................................................... 17

Figure 3-2: Province, municipalities and wards relevant to the study ...................................................... 18

Figure 3-3: Allocation of district and local municipalities in the regional ZoI ............................................ 20

Figure 3-4: ZoI wards demarcation .......................................................................................................... 22

Figure 3-5: Hendrina power station .......................................................................................................... 23

Figure 3-6: Hendrina ZoI locality .............................................................................................................. 24

Figure 3-7: Arnot power station ................................................................................................................ 24

Figure 3-8: Arnot ZoI locality .................................................................................................................... 25

Figure 3-9: Komati power station ............................................................................................................. 26

Figure 3-10: Komati ZoI locality .................................................................................................................. 27

Figure 3-11: Camden power station ........................................................................................................... 27

Figure 3-12: Camden ZoI locality ............................................................................................................... 28

Figure 4-1: Stakeholder analysis matrix ................................................................................................... 39

Figure 4-2: Stakeholder mapping ............................................................................................................. 42

Figure 4-3: Stakeholder issues per power station .................................................................................... 44

Figure 5-1: Hendrina power station option analysis ................................................................................. 50

Figure 5-2: Arnot power station options analysis ..................................................................................... 53

Figure 5-3: Komati power station options analysis ................................................................................... 56

Figure 5-4: Camden power station options analysis ................................................................................ 59

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DisclaimerThe opinions expressed in this Report have been based on the information supplied to SRK

Consulting (South Africa) (Pty) Ltd (SRK) by Eskom. The opinions in this Report are provided in

response to a specific request from Eskom to do so. SRK has exercised all due care in reviewing

the supplied information. Whilst SRK has compared key supplied data with expected values, the

accuracy of the results and conclusions from the review are entirely reliant on the accuracy and

completeness of the supplied data. SRK does not accept responsibility for any errors or omissions

in the supplied information and does not accept any consequential liability arising from commercial

decisions or actions resulting from them. Opinions presented in this report apply to the site

conditions and features as they existed at the time of SRK’s investigations, and those reasonably

foreseeable. These opinions do not necessarily apply to conditions and features that may arise after

the date of this Report, about which SRK had no prior knowledge nor had the opportunity to

evaluate.

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List of Abbreviations

AA Automobile Association

B-BBEE Broad-Based Black Economic Empowerment

CFBC Circulating Fluidised Bed Combustion

CO2 Carbon dioxide

CSI Corporate Social Investment

DM/s District Municipality/ies

FET Further Education and Training

GDP Gross Domestic Product

HIV/Aids Human Immunodeficiency Virus/Acquired Immunodeficiency Syndrome

HDI Human Development Index

IDP Integrated Development Plan

LED Local Economic Development

LM/s Local Municipality/ies

MDEDET Mpumalanga Department of Economic Development, Environment and Tourism

NDP National Development Plan

NGO Non-Government Organisation

NOx Nitrogen dioxide

PF Pulverized Fuel

PGDS Provincial Growth and Development Strategy

SDF Spatial Development Frameworks

SDGs Sustainable Development Goals

SED Socio-economic Development

SEP Stakeholder Engagement Plan

SMME Small Medium Micro-sized Enterprises

SOx Sulphur dioxide

SRK SRK Consulting (South Africa) (Pty) Ltd

StatsSA Statistics South Africa

TB Tuberculosis

VIP Ventilation Improved Pit

ZoI Zone of Influence

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1 Introduction

Background

Eskom owns and operates thirteen power stations in South Africa, and is responsible for generation,

transmission and distribution of electricity to South Africa. Of the thirteen power stations, eleven are

located in Mpumalanga Province. Most of these power stations are nearing their end of life, and

Eskom has commenced with the Generation Fleet Renewal Project to consider whether the

continuation of these power stations could play a role in meeting the electricity demand in South

Africa cost effectively. Eskom has identified four renewal options for consideration: refurbishment,

repower with biomass or gas, demolish and rebuild, and decommission).

The selection and identification of a preferred option will have implications for Eskom, the

communities surrounding the power stations, and the country as a whole. Eskom is therefore taking

the opportunity to proactively assess and understand the potential technical, financial and socio-

economic implications of the renewal options. The socio-economic considerations are to compliment

the technical and financial studies, since the socio-economic factors may have a significant

influence on the overall success of the chosen option as well as the long-term wellbeing and

sustainability of the affected communities.

SRK Consulting (SA) (Pty) Ltd (SRK) was appointed by Eskom to complete an early pre-feasibility

stage socio-economic assessment of the renewal options for four power stations: Hendrina, Arnot,

Komati and Camden. Camden Power station is located in the Msukaligwa Local Municipality in the

Mpumalanga Province. Arnot, Hendrina and Komati power stations are located in the Steve

Tshwete Local Municipality in the Mpumalanga Province. Figure 1-1 below provides an overview of

the locations of these four power stations.

Figure 1-1: Location of Arnot, Hendrina, Komati and Camden power stations



Overview of Renewal Options

As mentioned, Eskom identified four fleet renewal options:

Option 1A/1B: Lifex and Modernisation (Refurbishment);

Option 2: Repower with Biomass or Gas;

Option 3A/3B: Rebuild as PF or CFBC (Demolish and rebuild); and,

Option 4: Do not renew (Decommission)1.

Technical studies concluded that Option 2 was not technically viable, and this option is therefore

not assessed as part of this study. Figure 1-2 provides an overview of the three options under

consideration. Option 1A/1B is referred to as Option 1 in this report (506503/F1), and Option 3A/3B

is referred to as Option 3.

1 While generally known as decommissioning, this option has other variations such as:

- To continue operating the power station five years at a time until there is certainty on CO² budgets and demand profiles - Sell the power station - Mothball the plant - Utilise power plant components as spares for Eskom plants

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Socio-Economic Study Objectives

The business objective of the project is to ensure that fleet renewal cost effectively contributes to

meeting the electricity demand in South Africa, generating further revenue from electricity sales. In

light of the business objective, this pre-feasibility socio-economic study has to meet the following

key objectives:

Undertake a baseline study to understand the socio-economic landscape of the project’s Zone

of Influence (ZoI) (local and regional2), and understand the status quo in relation to the national

baseline;

Assess the socio-economic implications of the proposed project options and associated

infrastructure;

Identify stakeholder issues, opportunities, potential socio-economic impacts and risks, and

areas that would require mitigation for the options;

Assess the resilience/vulnerability of the communities in the context of the options; and,

Place the socio-economic considerations of the local communities into the broader context of

national priorities and sustainable development goals (social, economic and environment).

To meet the above key objectives, the socio-economic study needs to answer the following

secondary objectives:

Socio-Economic Baseline Assessment

Determine the socio-economic ZoI at each of the four sites;

Determine the current status of the prevailing socio-economic baseline at each of the four sites

(local and regional), historical and current social trends – population demographics, education

levels, income, migration, employment, health and social well-being, infrastructure and social

services;

Indicate labour and skills availability in the project area;

Identify predominant cultural and heritage aspects for consideration;

Establish links and integration of settlements with other regional communities;

Assess level of vulnerability/self-sustenance of communities in terms of how adaptive they will

be should any of the options be implemented;

Examine the contribution of the ZoI economy to the regional and provincial economy;

Review local development plans to establish local economic development (LED) in the area

including the nature and level of business activity, and indicating the level of dependence on

Eskom expenditure;

Determine whether or what the local institutional, legal and political aspects are; and,

Rate and rank the various options in light of the above information.

2 Regional refers to the relevant district and local municipalities, and local refers to communities adjacent to the power stations on ward level



Stakeholder Engagement

Present information on stakeholder engagement including:

Identification of relevant stakeholders (local and surrounding communities)3 with an indication

of their roles and interests; and,

Indicate current stakeholder engagement with Eskom with details regarding any relevant

commitments and/or agreements between Eskom and stakeholders/authorities.

Overarching National Priorities and Sustainable Development Goals

Identify and agree on a list of relevant national priorities and sustainable development goals as

per the South African National Development Plan (NDP) 2030 and Sustainable Development

Goals (SDGs); and,

Determine the extent to which the three options (refurbish, demolish and rebuild, decommission)

is synergistic or conflicting with the identified priorities and goals.

Impact Assessment and Options Analysis

Develop a methodology to rank and weigh the various project alternatives. This will consider

the added value to the national development goals and priorities as well as other socio-

economic considerations identified in the social baseline;

Identify up and down-stream activities that may be affected by the proposed alternatives

including water use/demand; and,

Conduct a high-level analysis to determine the potential socio-economic issues for the three

alternatives (locally and regionally).

Risk Assessment

In a risk matrix, for each option, identify high-level socio-economic risks to the project, and ways

in which to address these.

Scope of the Report

To meet the socio-economic objectives, the report (506503/F1) consists of the main components

outlined in Figure 1-3. The study commenced with a project initiation meeting, where after primary

and secondary data sources were consulted to: analyse the macro-economic and socio-economic

baseline, identify national priorities and SDGs relevant to the study, and to identify analyse

stakeholders. The results informed the impact assessment and options analysis, and the risk

assessment. The report (506503F/1) is structured in accordance with the order of the study

components in Figure 1-3.

3 Due to the sensitivity of the project and the fact that it is at early pre-feasibility stage, stakeholder engagement was limitedto discussions with relevant stakeholders at the district and local municipalities and internal Eskom and power station stakeholders



Figure 1-3: Study components

Methodology

Primary and secondary data sources were consulted to inform the macro-economic and socio-

economic baseline, to identify national priorities and SDGs relevant to the study, and to analyse

stakeholders. Section 8 lists the secondary data sources consulted.

In terms of primary data sources consulted, key informants were divided into the following three

categories: internal corporate stakeholders, internal power station stakeholders, and selected

external stakeholders. External stakeholders included relevant representatives from Nkangala and

Gert Sibande District Municipalities, and Steve Tshwete and Msukaligwa Local Municipalities.

Appendix A contains the details of meetings that were held.

Semi-structured interviews and discussions were conducted with these stakeholders, and a

discussion guide was developed to ensure that all the relevant aspects were covered. Appendix B

contains the discussion guides that were used.

Limitations

The limitations that apply to the socio-economic study are:

Different informants from Eskom provided contradicting information regarding the different

options;

Due to the confidentiality of the project, stakeholder engagement was limited to the two district

and two local municipalities;

Due to differences in timeframes between the socio-economic study and the technical study, it

was not possible to have an integration workshop. This report (506503/F1) uses the technical

information received from the technical team before 13 January 2017 to enhance and inform

the socio-economic study; and,

Technical studies were completed on 30 January 2017, and it is possible that information

changed since 13 January 2017.

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2 Macro-Economic Baseline Analysis Eskom, as the de facto sole power supplier to South Africa, plays a very important role in the South

African economy. Key roles of Eskom include:

Energy generation, thereby enabling economic activity and development in South Africa;

Contribution to State revenue through taxation;

Employment and skills development through direct and indirect employment and enabling of

wider socio-economic activity; and,

Enabling and driving social development and transformation in South Africa through provision

of power to previously unconnected communities, preferential procurement / employment and

funding of Corporate Social Investment (CSI) programmes.

These are briefly discussed below.

Energy Generation, Enabling Economic Activity and Development

2.1.1 Importance and Role of Energy

Energy, and electricity in particular, is a critical ingredient in modern economies, as it is an input to

nearly every good and service produced in an economy. A lack of access to a reliable source of

power is cited as a main constraint to doing business, before access to finance and corruption, by

nearly 7 out of 10 businesses in Africa (One, undated). A review of nearly 100 studies on the

relationship between energy provision and economic growth identified a clear positive correlation

between energy use and economic growth. Although the causal relationship is not always clear,

energy use is either the cause or the facilitator of economic growth. Insufficient, unreliable or costly

energy is a binding constraint for all sizes of business, especially those operating in the

manufacturing sector (CDC Group, 2016).

However, PRODUSE (2013) note that electricity is a ‘quintessential’ intermediate good and does

not represent an end in itself: it is an input factor to a large set of activities (“uses”) that can improve

welfare, increase productivity or generate income. These, however, also depend on complex

interactions and synergies between other multiple development factors, including other

infrastructure investments and enabling political, socio-economic and cultural conditions, and it is

increasingly recognised that certain “complementary” inputs or services – such as business

development services or access to finance – can increase the chances that access to electricity

leads to significant income generation and poverty alleviation.

The South African economy is relatively well developed and highly reliant on electricity. The

economy is closely linked to energy consumption, meaning that energy use tracks Gross Domestic

Product (GDP). As energy generation was cheap due to an abundance of easily accessible and

cheap coal, South Africa developed an energy intensive industry sector (Winkler 2009 in DEA,

2016). However, energy intensity decreased from 6.99 Mega joules per Rand of GDP in 2002 to

4.18 Mega joules per Rand of GDP in 2009 (DEA, 2016). In South Africa, mining and energy go

hand-in-hand, as mining is an energy intense activity and offers the country access to energy

embedded in the locally abundant coal reserves (DEA, 2016).

Energy use differs between economic sectors in South Africa (DEA, 2016) (Figure 2-1):

The industrial sector is the largest user, consuming 51.0% in 2009. Manufacturing, in particular,

is the most energy intensive sub-sector and includes several energy heavy activities such as

metal smelters, petrochemical facilities, as well as paper, sugar and pulp mills;



The transport sector is a significant energy user, accounting for 22.0% of energy use;

The residential or domestic sector accounted for 15.0% of national electricity consumption;

The commercial sector (including public services) uses relatively little energy at 10.0% in 2009,

but was growing at a fast rate. This sector consists of government, office buildings, financial

institutions, shops, recreation and education; and,

The agricultural sector consumed less than 2.0% in 2009; it uses liquid fuels alongside electricity

and gas.

Figure 2-1: Electricity consumption by different sectors in South Africa

Source: DEA, 2016.

The importance of electricity to the South African economy is exemplified by the estimated economic

impact of load shedding in 2007/08 and 2015. Dawie Roodt estimated that the electricity crunch

from 2007 to 2015 cost the economy more than R300 billion in lost output (Fin24, 2015). Chris

Yelland estimated the cost of Stage 14 load shedding as R20 billion per month, Stage 25 as

R40 billion per month and Stage 36 as R80 billion per month. Based on an approximate South

African GDP of R4 trillion in 2014, load shedding could have reduced GDP by approximately 1-2%

per month of load shedding (Tralac, 2015).

Considered from the aspect of pricing, the 2010 – 2013 price increases in South Africa were

estimated to result in negative impact on GDP of 1.1% and a loss of 16 000 jobs in the overall

economy, based on 2009 employment figures (Eskom, 2011).

2.1.2 Contribution by Eskom to the South African Economy

Eskom generates approximately 90.0% of the electricity used in South Africa (Eskom, 2016), and,

by indirectly enabling economic activity requiring electricity, added some R40 billion in direct value

4 Stage 1 allows for up to 1000 MW of the national load to be shed5 Stage 2 allows for up to 2000 MW of the national load to be shed6 Stage 3 allows for up to 3000 MW of the national load to be shed

Industrial51%

Transport22%

Residential15%

Commercial10%

Agriculture2%

.



to South Africa's economy in 2014/15, with an additional R150 billion in indirect and induced value

added (KPMG, undated).

Eskom also directly sources goods and services from different industries, ranging from power plant

maintenance to business services. Procurement amounted to more than R25 billion in 2011 for

normal operations. Eskom’s capital expansion (build) programme adds further stimulus to the South

African economy. By 2014/15, Eskom had invested more than R200 billion (excluding capitalised

borrowing cost) in the build programme. Another R293 billion are expected to be invested in the

build programme by 2021. The direct, indirect and induced economic impact of Eskom’s build

programme between 2008 and 2020 was estimated at R883 billion by KPMG (undated).

A study by Quantec Research found that Eskom’s direct impact on the South African GDP as a

result of its operational and capital expenditure is 3.0%, taking into account only initial impacts and

first-round effects in the economy. When considering economy-wide (indirect and induced) effects,

Eskom’s impact is estimated to be more than 7.0% on GDP (Eskom, 2011). A KPMG study found

that Eskom’s GDP impact, due to Eskom’s generated revenue, represented 5.0% of South Africa’s

GDP in 2014/15 (KPMG, undated).

2.1.3 Costs to the South African Economy Associated with Coal-based Energy

The historic low cost of commercial energy, achieved by not internalising externalities associated

with coal, led to inefficient energy use in South Africa, accelerated national reserve depletion and

pollution and made South Africa one of the highest carbon (greenhouse gas) emitters in the world

(Winkler et al., 2006 in DEA, 2016). In comparison with the low cost at which coal-based energy

could be supplied at the time, renewable energy technologies appeared particularly expensive,

further entrenching structural reliance on centralized coal-based energy. Affordable renewable

power remained largely out of reach for the poor and rural areas and individualised off-grid, mini-

grid or micro generation opportunities were limited. A number of government policy documents have

recently promoted a large-scale switch to more environmentally sustainable energy sources (DEA,

2016).

While Eskom will undoubtedly remain critical to South African energy provision, electricity sales in

key segments, such as industry, mining and commerce, are relatively stagnant, either at or nearing

a 15-year low. Prices of a number of alternative energy generating technologies are declining and

consumers are increasingly defecting from the grid, negatively impacting Eskom’s revenue and

business model. In response to recent price increases and supply concerns, customers are

improving energy efficiency and making their own generation decisions (Eskom, 2016).

Contribution to State Revenue through Taxation

Eskom achieved a net profit after tax of R4.6 billion for the year ending 31 March 2016 (up from

R200 million in 2015), and is thus currently contributing positively to the income of the South African

Government. Eskom operations were liable for income tax of some R2.5 billion in 2016, of which

some R500 million were paid to the South African Government and some R2 billion were deferred

in 2016 (Eskom, 2016).

The effective tax rate for Eskom for the year 2016 was 35.0% (compared to 13.3% in 2015) due to

an increase in non-deductible expenditure (Eskom, 2016). For comparison, the corporate income

tax rate in South Africa in 2016 is 28.0% (SARS, 2016).

KPMG (undated) estimates that Eskom’s new build programme contributed some R85 billion to

government revenue between 2008 and 2014 and will contribute R88 billion between 2015 to 2020

through direct and indirect taxes as well as broader fiscal impacts generated through linkages with

other economic sectors.



For many municipalities, electricity supply is also a considerable revenue stream, and some 240

local authorities buy bulk electricity from Eskom and distribute it in their areas of jurisdiction at a

marked-up price (DEA, 2016).

Employment and Skills Development

Eskom had some 48 000 direct employees (permanent staff and full-time contractors) in 2016, up

from 40 000 in 2011 (Eskom, 2016 and 2011). Together with Transnet, Eskom is one of the top

employment-generating State Owned Enterprises in South Africa (Table 2-1).

Indirect employment in sectors providing inputs to Eskom amounted to some 219 083 jobs in

2014/15, while some 290 000 induced jobs were created through the multiplier effect of Eskom’s

salaries and wages (KPMG, undated).

Table 2-1: Employees in State Owned Enterprises in 2010

State Owned Enterprise Sector Employees (in 2010)

Transnet Transport 45 564

Eskom Energy 39 222

South African Airways Transport 7 989

Denel Defence 5 067

South African Broadcasting Corporation Communication 3 346

Airports Company South Africa Transport 2 582

South African Forestry Company Forestry 2 255

South African Express Airways Transport 839

Alexkor Mining 112

Broadband Infraco Communications 79

Source: Klopper (2010).

In 2011, Eskom provided its workforce with 298 000 training days, equivalent to an average of seven

days of training per employee, which represented an investment of R998 million. In addition, Eskom

trains current and potential business partners and creates training opportunities at its major

suppliers (Eskom, 2011). Eskom also runs additional skills development programmes to train

engineers, technicians and artisans to meet Eskom’s future need for skilled workers (Eskom, 2011).

Eskom procures from a wide range of industries and service providers, including mining,

construction, cement and steel manufacturing and manufacturers of machines and other industrial

equipment. The jobs that are directly and indirectly supported through Eskom’s activities are

distributed and require a wide range of different skill sets, thereby benefitting people from different

educational backgrounds and regions and stimulating economic diversification in South Africa.

(Eskom, 2011).

At least 50.0% of procurement in Eskom’s new build programme is sourced locally (KPMG,

undated). KPMG (undated) estimates that the new build programme sustained some 763 000 direct,

indirect and induced jobs between 2008 and 2014. This figure rises to 783 000 direct, indirect and

induced jobs that are expected to be sustained by the new build programme between 2015 and

2020.



Enabling and Driving Social Development and Transformation

2.4.1 Role of Energy in Human Development

Electrification is deemed to have strong social benefits above and beyond economic growth.

Electrification, particularly of rural areas, is associated with improved literacy rates, health and

general living conditions as well as new prospects such as the ability to work at night and business

and trade expansion. Electrified households in Bangladesh have demonstrated higher improvement

on all quality of life indicators, including life longevity, per capita real income and human

development index, than households that are not electrified (GENI, 2007). In Brazil, electrification

was associated with a modest increase in house values and a significant increase in the Human

Development Index (HDI) in the connected area (Lipscomb et al, 2013).

Such improvements are achieved by allowing families to allocate time more effectively, e.g. by

reducing the time spent collecting firewood and/or extend working/learning hours into the night,

providing access to modern technology and information and enhancing people’s perception of safety

through electric lighting. The domestic burden may be reduced particularly for women, thus

contributing to a reduction in the gender gap. Improved health outcomes can be achieved by

enabling refrigeration (of medicines and food) and medical technologies. Indoor pollution can be

reduced or avoided through displacement of domestic wood and coal burning (Eskom, 2011, IEG,

2008).

However, while a better HDI is associated with higher levels of electricity access across the world,

the magnitude of the impact on HDI varies among countries with the same level of energy access

(Iyer, 2013) (Figure 2-2).

Figure 2-2: Human Development Index versus electrification rates

Source: Eskom, 2011.

As noted with regards to energy’s role in enabling of economic activity, electricity is a ‘quintessential’

intermediate good and does not represent an end in itself. Cook (2013) notes in this context that

rural electrification programmes are most effective when implemented with complementary

infrastructure, including educational initiatives that influence change to enable the users of electricity

to put energy to productive uses; such programmes are not normally part of rural electrification

programmes.



2.4.2 Contribution by Eskom to South African Electrification

Energy inequality was deeply entrenched in South Africa by Apartheid spatial development patterns

that created ‘whites only’ towns and cities with ‘blacks only’ dormitory townships at some distance

from the main electricity networks. These spatial patterns remain in existence even where the

townships have been swallowed by urban growth, and hence perpetuate the inequitable access to

affordable energy and economic opportunities (SEA, 2011 in DEA, 2016).

Eskom connected more than four million users to electricity from 1991 to 2011 as part of its

electrification programme. By 2011, 83.0% of South African households had access to electricity,

with some 2.5 million households remaining unconnected. In the same period, Eskom brought

electricity to more than 11 000 schools and more than 350 clinics throughout South Africa. By 2016,

almost 90.0% of South African households had access to electricity (eNCA, 2016).

Initially high connection rates (averaging at 290 000 connections per year between 1994 and 2000)

slowed to less than 200 000 new connections per year on average between 2001 and 2009 (Eskom,

2011). Some 158 016 new electrification connections were achieved in 2016 (compared to 159 853

in 2015), below the target of 194 374 (Eskom, 2016). Eskom and municipalities are planning to

spend R17.6-billion between 2017 and 2020 to connect more than 840 000 additional households

to the national grid, and 70 000 households to non-grid solar electrification programmes (eNCA,

2016). Universal access to electricity is envisaged by 2025 (Eskom, 2016).

As such, by significantly increasing access to electricity across rural and poor urban areas, Eskom

is deemed to make a significant contribution to human and social development across South Africa.

However, affordability of electricity by households connected to the grid remains a challenge, as

exemplified by the number of illegal connections and outstanding payments. Cook (2013) also notes

that, in an international context, connection and electricity charges continue to represent serious

constraints for the poor.

Poor households still constitute a very small proportion of residential electricity consumption and

account for 0.5% of total national electricity consumption (Winkler & Tait, 2012 in DEA, 2016). At

the same time, poor households spend up to 20.0% or more of their household budget on energy,

compared with 2-3% for wealthier households (SEA, 2006 in DEA, 2016). The resulting energy

poverty, despite being connected to the grid, results in remaining challenges such as inadequate

access to appropriate and safe energy sources and appliances, hazards such as fires and burns

due to illegal connections and compromising of income-generating activities. As noted above,

electrification programmes should be accompanied by complementary programmes and an

appropriate pricing/subsidy structure.

2.4.3 Contribution by Eskom to Transformation and Economic Empowerment

South Africa's government implements a Broad-Based Black Economic Empowerment (B-BBEE)

strategy to redress the political, social and economic inequalities of the past. The fundamental

objective of the B-BBEE is to advance economic transformation and enhance the economic

participation of black people in the South African economy (DTI, undated) and to further create

capacity within the broader economic landscape at all levels through skills development,

employment equity, socio economic development, preferential procurement, enterprise

development (especially of small and medium enterprises), promoting the entry of black

entrepreneurs into the mainstream of economic activity and the advancement of co-operatives

(Economic Development Department, undated).

Eskom actively contributes to transformation and the implementation of B-BBEE through notably

preferential procurement and employment. Some 82.0% of Eskom’s procurement was spent on B-

BBEE compliant providers in 2016, and racial equity in senior management is 61.0% (Eskom, 2016).



2.4.4 Community Development and Funding of CSI Programmes

Eskom also contributes to community development through Corporate Social Investment (CSI)

programmes through the Eskom Foundation, with a focus on job creation, skills development and

poverty alleviation. In 2016, Eskom committed R103.6 million in CSI initiatives (on 184 projects

impacting 302 736 beneficiaries), up from R115.5 million in 2015 (on 239 projects impacting 323 882

beneficiaries) and down from R133 million (on 231 projects impacting 357 443 beneficiaries) in 2014

(Eskom, 2016).

The Eskom Foundation focuses on socio-economic development needs in the following key areas:

Support to small and medium enterprises (through networking, training and incubator support);

Education programmes (from pre-school to tertiary level);

Health support programmes (through mobile clinics and provision of equipment); and,

Community development and welfare programmes (such as funding specific needs, food

security and facilitating employee volunteering).

The effectiveness of Eskom’s CSI spending in community development will depend on a number of

factors, and analysis thereof falls outside of the scope of this study.

2.4.5 Regional/Local Perspective

The economy of the Steve Tshwete Local Municipality, where three of the four power stations are

located, is dominated by mining, manufacturing and finance (Steve Tshwete Local Municipality,

2015). While Eskom contributes to the local economy, other sectors, such as mining and steel

manufacturing, contribute significantly more to GDP and employment than the electricity/utilities

sector (see Table 2-2) (Steve Tshwete Local Municipality, 2015).

Table 2-2: Key economic sectors of the Steve Tshwete Local Municipality

Sector Contribution to GDP Contribution to Employment

Mining 45.8% 20.7%

Manufacturing 17.2% 6.5%

Community Services 9.4% 13.6%

Finance 8.7% 11.3%

Trade 7.1% 21.4%

Electricity/Utilities 5.2% 2.5%

Source: Steve Tshwete Local Municipality (2015).

Limited quantitative information is available on Eskom’s economic role at the regional/local level.

The current economic contribution of the operation of the four power stations relates primarily to:

Long-term direct employment during operations of 690 employees at Hendrina power station

and 710 employees at Arnot power station, 470 employees at Komati power station and 373

employees at Camden power station;

Indirect employment: at Eskom, this amounts to twice the number of direct employees, deemed

to support a total population 13 times the number of direct employees (Eskom, 2011); and,

Procurement spending related to operating the above power stations: as the power stations

have been operating for many years, it is assumed that many of the services procured during

operations are available in and sourced from the region, thus benefitting the local economy.

Most negative externalities (impacts) associated with electricity generation, on the other hand, are

also localised in the vicinity of the power stations, including impacts on water quality and quantity,



air quality (and associated costs of health care associated with respiratory diseases) and additional

mining-related impacts (such as sterilisation of farmland and compromised tourism opportunities)

(DEA, 2016).

Economic Implications of Decommissioning Power Stations

2.5.1 Continued Operation

Two end of life options include the continued operation of the power stations – either as refurbished

(Option 1) coal-fired power stations or as demolished and rebuild power stations (Option 3). Both

are discussed in this section, as the overall impacts will be similar.

The economic impacts of upgrading and continuing to operate the four power stations are likely to

be more limited than those of decommissioning the plants, and relate particularly to the following

aspects, which may manifest at a national and/or regional level:

Increase in procurement spending: It is expected that substantial procurement spending will

be made during refurbishment/modification of the power stations, far above levels associated

with ongoing operations-related procurement. As goods and services required during

refurbishment/modification are likely to differ from those required during normal operations,

procurement spending may go to different service providers than those historically working with

Eskom in the region, and possibly to providers outside of the region if the skill/service does not

exist locally. High procurement spending is expected to last over the short- to medium-term until

works are completed, whereupon lower operations-related procurement would resume;

Cost of energy: The future cost of energy, relative to the current cost, will depend on the

procurement and operating costs of the technology installed in the refurbished/modified power

stations. An increase in the cost of energy could result in reduction in economic output similar

to those estimated for historic price increases and/or stimulate further energy efficiency gains;

Energy supply: The quantity of generated energy is likely to remain stable in the long run,

assuming the refurbished/modified power stations will have a similar installed capacity and

operating workforce as the present power stations. A drop in energy-generating capacity can

be expected during the refurbishment / modification of the plants;

Employment: The number of jobs at the power plants is likely to remain stable in the long run,

assuming the refurbished/modified power stations will have a similar installed capacity and

operating workforce as the present power stations. Different skills and workforces might be

required during refurbishment/modification of the plants, which may lead to short- to medium-

term fluctuations in job opportunities in the region.

Any induced cumulative effects on coal mines in the area if power stations are modified to operate

on alternative energy, through reduced demand from the power stations, are likely to result in a

decrease in employment in the regional mining sector. Depending on the alternative energy source,

the loss of mining jobs may be compensated by increased employment in other sectors providing

the alternative energy source.

2.5.2 Decommissioning

As per section 1 of this report, decommissioning options include continuing operating the power

station for five years at a time until there is certainty on carbon dioxide (CO2) budgets and demand

profiles, selling the power station, mothball the plant or utilise power plant components as spares

for other Eskom plants. All are classified as decommissioning and are discussed in this section, as

the overall impacts will be similar, although impacts are likely to occur more gradually over a longer

timeframe with the slow stripping of power stations for spares.



National Perspective

The key potential economic impacts at a national level of decommissioning the four power stations

are related to the following:

Reduction in energy supply: The impact is deemed minimal at a national level if the loss of

~6 500 MW installed capacity as a result of the decommissioning of the four power stations is

replaced with a similar or higher capacity at other facilities. If lost power generating capacity is

not replaced, a shortage in energy supply could result in loss of economic output similar to that

experienced during load shedding in 2007/08 and 2015;

Cost of energy: The future cost of energy, relative to the current cost, will depend on the

procurement and operating costs of the technology replacing the decommissioned power

stations. An increase in the cost of energy could result in reduction in economic output similar

to that estimated for historic price increases and/or stimulate further energy efficiency gains;

and,

Loss of jobs: The four power plants currently employ some 2 250 staff. Even if all of these jobs

are lost in decommissioning, the impact is deemed minimal at a national level if the number of

direct and indirect jobs lost at the four power stations following decommissioning is offset by

jobs created in other / new power generating industries in South Africa.

Regional/Local Perspective

The economic implications of decommissioning at a regional and local level are, to some extent, a

reversal of the impacts and benefits experienced during operation:

Loss of jobs: The number of directly and indirectly employed staff at the four power stations is

likely to reduce as soon as decommissioning begins, as it is anticipated that a smaller workforce

is required for the decommissioning phase. Depending on timing, job losses during

decommissioning of the four power stations could be cumulative with the reduction of

construction jobs experienced in the region following the construction of newly built power

stations (e.g. the Kusile construction workforce of up to 11 000 reduces to less than 1 000

operation staff); and,

Reduction in procurement spending: It is expected that substantial procurement spending

will be made during decommissioning. However, as goods and services required during

decommissioning are likely to differ from those required during operations, procurement

spending may go to different service providers than those historically working with Eskom in the

region, and possibly to providers outside of the region if the skill/service does not exist locally.

Following decommissioning, procurement spending would cease.

As the electricity / utilities sector makes a comparatively limited contribution to local GDP and

employment, the overall negative impact on the local and regional economy from decommissioning

the power stations is likely to be relatively limited. However, any induced cumulative effects from

the decommissioning on coal mines in the area, through reduced demand from the power stations,

are likely to have a higher and cumulative impact on the regional economy.

These impacts are unlikely to be offset at the local scale, as may be the case at national scale, as

jobs created in alternative energy-generating industries (e.g. renewables, nuclear or more modern

technology) may not be accessible to the existing workforce at the four power plants as they may:

Require different skills; and,

Be located in a different region of South Africa, which is likely to already have a local labour

force in need of employment.



Opportunities for Enhancement

The following measures may enhance or mitigate the economic impact from decommissioning the

four power plants:

In cooperation with the municipality, identify alternative projects that can provide continued

employment to workers after decommissioning;

In cooperation with the municipality, encourage projects and/or networks that provide training

and support for small and medium enterprises. Initiate such programmes as early as possible;

Provide workers with personal finance and skills training to manage the transition period into

new employment; and,

Maintain good communication with workers about the decommissioning process.



3 Socio-Economic Baseline Analysis This section describes the socio-economic baseline characteristics and socio-economic trends. An

emphasis is placed on aspects that may potentially be impacted by the various options. This

information, in turn, informs the development of the criteria for assessing options. In summary, the

following key characteristics are considered in the development of the impact assessment and options

analysis (Figure 3-1):

Figure 3-1: Social issues

Provincial Context Summary

The focus of this section is to provide a context for the ZoI as identified in section 3.3. A baseline of

the province is also important as the implementation of one of the three options may potentially create

impacts on a provincial level (Figure 3-2).

Alternative Employment Opportunities:Will there be adequate opportunities for employmentelsewhere should an option result in job losses?

Procurement:Will there be sufficient alternative opportunities for local contractors should anoption result in loss of contracts with local contractors?

Service Delivery:Will local services to communities be impacted negatively?

Health Impacts:Will an option contribute to negative environmental impacts?

Education and Skills:Will there be sufficiently educated and skilled local people to work at the powerstations should the preferred option require additional staff/contractors with specific skills andexperience?



Figure 3-2: Province, municipalities and wards relevant to the study7

3.1.1 Demographic Overview

The Mpumalanga Province comprises of three district municipalities, which are in turn, divided into 18

local municipalities. The province has a population of 4 039 939 people. The population of 2.6 million

in 1996 has grown to over 4 million in 2011, now representing approximately 8.0% of the South African

population (South African Census, 2011). Table 3-1 provides the structure of this population. Black

Africans are in the majority, representing 90.6% of the total population.

Table 3-1: Population structure of the Mpumalanga Province

Population Group Male Female Total

Black 1 781 368 1 880 850 3 662 219

White 151 557 152 038 303 595

Coloured 18 149 18 462 36 611

Indian/Asian 16 165 11 753 27 917

Other 6 817 2 780 9 597

Total 1 974 055 2 065 883 4 039 939

Source: StatsSA, 2011.

3.1.2 Provincial Economy

Economic growth

All four of the power stations under review in this report are located in Mpumalanga Province. The

Mpumalanga Province is considered the generation hub of South Africa’s electricity network due to

the concentration of power stations in this region and their close proximity to the large centres of loads.

Currently, 11 of 13 Eskom coal-fired power stations, namely, Arnot, Camden, Duvha, Grootvlei, Hendrina,

Kendal, Komati, Kriel, Matla, Majuba and Tutuka are located in the Mpumalanga Province.

7

For the purposes of this report, “Local Municipality” and “District Municipality” have been abbreviated in figures to LM and DM respectively



In addition to the 11 coal-fired power stations, one of the two Eskom power stations that are currently under

construction, namely, Kusile Power Station is located in the Mpumalanga Province (Eskom Transmission

Development Plan, 2016-2025).

In the mid-1990s, the Mpumalanga Province had one of the fastest growing economies in South Africa.

Although it is one of the less populated and second smallest of the provinces in the country, the

Mpumalanga Province has the fourth largest economy, based largely on the rich natural resources of

the area. However, as with the rest of the South African economy, this growth rate has slowed down

considerably (Mpumalanga Department of Economic Development, Environment and Tourism

(MDEDET), 2009).

The main industrial and manufacturing activities in the Mpumalanga Province include iron, steel,

stainless steel, petrochemicals and chemical products, agricultural products, mining, power

generation, timber and wood products and food processing. The potential for further development in

these sectors, as well as tourism, is considerable. The favourable location of the province enhances

its development potential with the Maputo Corridor linking the province to Maputo in Mozambique, the

close proximity to the substantial Gauteng market and the rail and road infrastructure allowing access

to ports at Durban and Richards Bay (Mpumalanga Provincial Government, 2016).

The Mpumalanga Province’s economy is dominated by mining, mostly coal for the Eskom power plants

located in the province, although some of the coal is sold to international clients. As a result, it benefited

from the commodity boom that lasted from 2003 to 2011 (Real Economy Bulletin, 2016). However, it

has experienced much slower growth since then. The Mpumalanga Province also has extensive heavy

industry, which forms part of the long-standing Highveld complex, and a strong commercial agricultural

sector. These industries have driven its growth since 2011.

The strength of the province’s major sectors has meant it has been mainly at, or above, the national

average for employment and income levels. Despite this, two fifths of the population (40%) –

substantially more than the national average – live in former homeland regions, where infrastructure,

employment and incomes lag behind national norms (Real Economy Bulletin, 2016).

While the Mpumalanga Province, with 4.3 million residents, accounted for 8.0% of South Africa’s

population in 2014/5, it contributed 7.0% of the GDP. In 2014, the real economy (represented by

agriculture, mining, manufacturing and construction) made up 40.0% of its output. The real economy

sector was dominated by mining, at 22.0% of the provincial economy as per Statistics South Africa

(StatsSA, 2016).

The average annual growth rate for the country and the Mpumalanga Province over the period 1996

to 2011 was 3.2% for South Africa and 2.7% for Mpumalanga, respectively. The NDP targets average

national GDP growth of over 5% up to 2030 (StatsSA, 2016).

The Mpumalanga Province had a labour force of approximately 1.9 million individuals in the third

quarter of 2015 (StatsSA, 2016). This has decreased by approximately 40 000 in the fourth quarter of

2015 (StatsSA, 2016). This is predominantly due to the international and national economic downturn.

The province has an estimated unemployment rate of 25.7% (StatsSA, 2016).

Manufacturing is the biggest contributor to

employment at 40.5%. Coal dominated mining

employment in Mpumalanga, producing mainly to

supply Eskom as well as for export. While Eskom

may take higher volumes of coal, the majority of the

profits earned come from the export market. Thus,

the dependency on coal exports is also high.

With coal mining dominating employment in

the province, the decommissioning of any

power stations will lead to significant job

losses in an already stressed socio-

economic environment.



Generally, gold mining saw job losses during the commodity boom, while platinum mining, coal and

iron ore created employment. According to Department of Mineral Resources data, total mining

employment in the Mpumalanga Province climbed from 53 500 in 2003 to 102 000 in 2011 and over

103 000 in 2015. Total employment in Mpumalanga constituted 7.5% of employment in the country in

2014 (Real Economy Bulletin, 2016). The area’s dependency on minerals and mineral prices implies

that a downturn in commodity prices may affect the economic growth of the area.

Regional Context

3.2.1 Introduction

For the purpose of this report, the regional ZoI describes the district and local municipal context of the

four Eskom power stations under discussion. The Arnot, Hendrina and Komati power stations are

located in the Steve Tshwete Local Municipality within the Nkangala District Municipality, while

Camden power station is located in the Msukaligwa Local Municipality in the Gert Sibande District

Municipality(Figure 3-3).. Appendix contains the detailed baseline description of the regional ZoI.

Figure 3-3: Allocation of district and local municipalities in the regional ZoI

3.2.2 Summary of Baseline

This section is based on StatSA (2011) information and summarises the detailed description in

Appendix C.

Nkangala District Municipality and Steve Tshwete Local Municipality

Nkangala District Municipality has six local municipalities namely, Steve Tshwete, Dr JS Moroka,

Emakhazeni, Emalahleni, Thembisile Hani and Victor Khanye;

Approximately one third of the population of Mpumalanga Province lives in the Nkangala District

Municipality;

Nkangala District Municipality has a higher average annual population growth rate than the

province;

Nkangala District Municipality is considered an energy, mining and trade hub of the province, and

contributed to close on half of the provincial GDP in 2014;



Coal mining and energy generation are big sectors in Steve Tshwete Local Municipality, and as a

result, Steve Tshwete Local Municipality is a significant contributor to the Nkangala District

Municipality economy, contributing to a third (33.0%) of the district GDP in 2014.

Gert Sibande District Municipality and Msukaligwa Local Municipality

Gert Sibande District Municipality has seven local municipalities, namely Msukaligwa, Chief Albert

Luthuli, Dipaleseng, Dr Pixley Ka Seme, Govan Mbeki, Lekwa and Mkhondo;

Gert Sibande District Municipality’s economy is largely based on manufacturing, which contributed

to close on two thirds of the GDP in 2013; and,

Msukaligwa Local Municipality’s economy is based largely on finance, community services,

transport, trade and mining.

Regional Patterns

The following general patterns for the region are evident:

The majority of the population in the region is comprised of Black Africans;

Apart from Gert Sibande District Municipality, settlement distribution is largely urban, with

dispersed farm settlements throughout the Steve Tshwete Local Municipality in Nkangala District;

Steve Tshwete Local Municipality has a high population growth rate, which exceeds all other local

municipalities in Nkangala District Municipality;

Across the regional ZoI, the majority of the population is of working age and below the ages of 35,

with a high dependency rate associated with a significant youthful population below 18 years old;

Females account for the larger portion of the populations in all but Steve Tshwete Local

Municipality, where there is a larger male population which may be liked to high levels of migration

into Steve Tshwete Local Municipality;

Migration into the regional ZoI is above national average (0.9 migrants per 1 000 people), which

could be for a number of reasons including push factors from sending countries as well as pull

factors from South Africa, traditionally a labour intensive economy;

Land use in the regional ZoI can be broadly defined as largely residential, with more agricultural

(farm) land use occurring in Gert Sibande District Municipality and Msukaligwa Local Municipality.

Industrial land uses occurred proportionately more in Steve Tshwete Local Municipality than the

other local and district municipalities, while informal residential settlements were notably higher in

Msukaligwa Local Municipality;

Across all four municipal designations, most houses are brick structures on separate stands or

yards;

Steve Tshwete Local Municipality has the highest percentage of working-aged (15+ years)

employed people and the lowest percentage of economically inactive people;

Nkangala District Municipality has the higher unemployment rate of the two districts, however it is

marginal;

Both community services and trade feature as one of the top three employment sectors in the

regional ZoI. The locality of the municipalities on important transport and trade corridors can be

seen as the reason for the high employment in the trade sector;



Annual household income is distributed similarly across the four district and local municipalities.

Nkangala District Municipality has the greatest prevalence of no income. However, Steve Tshwete

Local Municipality has the lowest instance of no income households. Excluding Steve Tshwete

Local Municipality, the most prescribed income bracket is R19 601-R38 200, which is classified

as a low to middle income bracket;

The level of education in all four municipalities is better than the provincial average, with Nkangala

District Municipality having the best education out of the two district municipalities;

Gert Sibande District Municipality has the higher prevalence of non-educated people over 20 years

old; primary education prevalence was higher in both the Gert Sibande District Municipality and

Msukaligwa Local Municipality, when compared to Nkangala District Municipality and Steve

Tshwete Local Municipality. Secondary education levels of Gert Sibande District Municipality are

in line with the Nkangala District Municipality in Gert Sibande District Municipality and Msukaligwa

Local Municipality, but lower than Steve Tshwete Local Municipality. Tertiary education, like much

of South Africa and Mpumalanga, is low, which can be attributed to (amongst other reasons) lack

of tertiary education campuses in the municipalities (other than Further Education and Training

(FET) colleges) as well as financial constraints presented by attending tertiary institutes;

Human Immunodeficiency Virus/Acquired immunodeficiency syndrome (HIV/Aids) is a common

cause of death across the municipalities, and Aids related deaths including Tuberculosis (TB),

pneumonia and diabetes could mean that HIV/Aids related deaths are in fact higher; and,

Road accidents and external accidental incidents feature highly and could be an indication of poor

road conditions as well as negligent driving and un-roadworthy vehicles.

Local ZoI Context

For the purpose of this report, the local ZoI is defined as municipal wards in which each Eskom power

station is located or has significant influence in. As such, the ZoI’s are defined as per Figure 3-4. For

detailed socio-economic and demographic information of each ZoI, please see Appendix D. A socio-

economic and socio-demographic summary is provided in Table 3-2.

Figure 3-4: ZoI wards demarcation



3.3.1 Hendrina ZoI

Overview

Hendrina power station is located in Ward 3 of the

Steve Tshwete Local Municipality, approximately

17 km North-West of Hendrina and 35km East of

Emalahleni. The first operations were

commissioned in 1970 making it the largest in the

world with ten turbines. The decommissioning

date for Hendrina power station is 20308.

Hendrina is supplied by coal from the surrounding

Optimum Colliery and Woestalleen Mines.

Additional coal is also trucked in to ensure that the

necessary stockpile levels are maintained.

Figure 3-5: Hendrina power station

Settlement Distribution and Density

The Hendrina ZoI is bordered by Emalahleni and Kriel to the west, Belfast and Carolina to the East

and Bethal and Ermelo to the South. It is situated in the Mpumalanga coal fields and as such, much

of the land in the ZoI is owned by private mining companies and Eskom. A Google Earth satellite

image from August 2016 is provided in Figure 3-6.

The Hendrina ZoI is largely urban, and the

current settlement distribution and settlement

dynamics within the Hendrina ZoI are indicative

of this. The highest concentration of settlement

is within Hendrina, Kwazamakuhle and

Pullenshope. It is evident from time-lapse

satellite imagery (Google Earth, 2016) that the

expansion of the towns and other human

settlements has, to an extent, been limited by

topography, service infrastructure and the

historical demarcation of the area.

The Hendrina ZoI is part of the N4 Maputo Corridor, and settlement in the area has been dictated by

transportation routes economics and service requirements (N11 and N4). Privately owned land with

commercial coal mining, power generation facilities and the N4 highway have limited the plausibility of

urban, residential expansion outwards in parts.

8 As per the document: Enquiry on requirements for Environmental Impact Assessment (EIA) for the Generation Fleet Renewal Programme: Option 4 Do not Renew (Eskom, 2016)

Pullenshope is considered as the ‘host’

community for Hendrina. This town was

originally constructed to house Eskom

employees. Kwazamakuhle Township and

Hendrina Town are also considered important

as they are the main receptors of fugitive dust

and air emissions from the stacks – Hendrina

power station, 2016.



ESKOM SOCIAL BASELINE HENDRINA ZOI LOCALITY

Project No. 506503

Figure 3-6: Hendrina ZoI locality

Source: Google Earth, 25 August 2016.

3.3.2 Arnot ZoI

Overview

Arnot power station is located approximately

34km South-East of Emalahleni within Ward 7 of

the Steve Tshwete Local Municipality. The power

station is only 20km North-East of Hendrina and

therefore has many similarities, particularly in

terms of stakeholder relations and zone of

influence.

The first of six units at Arnot power station was

originally commissioned in 1971, with a current

anticipated decommissioning date of 20369.

Many parts of the power stations, including the

boilers, have already passed their anticipated life

cycle.

Figure 3-7: Arnot power station

The Exxaro Mine that has always supplied coal to the power station has now closed, therefore the

required coal supply is now transported via road and conveyor.

9 Ibid (Eskom 2016)




StatsSA’s Census 2011 and settlement

patterns viewed on Google Earth (2016)

suggest the ZoI population lives largely in

urban areas. The highest concentration of

human settlement is within the settlements

of Arnot and Rietkuil town. It is evident that

the expansion of the towns has, to an

extent, been limited by commercial

agricultural and mining operations in the area, and many households are located on farms. Rietkuil

itself is a mining town, and has developed around coal mining operations on its peripheries. The Arnot

ZoI is bordered by Emalahleni in the northwest and is serviced by the N4 and R104 in the North of the

ward. Commercial agriculture is largely found in the north of the Arnot ZoI, with mining prevalent in the

southern quarters of the Arnot ZoI. A Google Earth image from June 2016 is provided in Figure 3-8.

ESKOM SOCIAL BASELINE ARNOT ZOI LOCALITY

Project No. 506503

Figure 3-8: Arnot ZoI locality

Source: Google Earth, 25 June 2016.

While Rietkuil is considered the host

community, Hendrina and Kwazamakhule

are also included. Arnot often partners with

Hendrina as they share this ZoI – Arnot




3.3.3 Komati ZoI

Overview

Komati power station is located approximately

37km South of Emalahleni within Ward 4 of

the Steve Tshwete Local Municipality. The

power station is 40km South-East of

Emalahleni and is just under 20km from the

Hendrina power station.

Komati power station was one of the first

pulverised fuel firing stations and its first of

nine units was commissioned in 1961 and is

due to be decommissioned in 202610. Many

parts of the power station, including the

boilers, have already passed their anticipated

life cycle.

Figure 3-9: Komati power station

The Koornfontein Mine supplies coal to the power station, while surplus coal requirements are trucked

in from elsewhere.


The Komati ZoI is bordered by Pullenshope to the

north east and Hendrina to the east. It is situated in

the Mpumalanga coal fields and as such, much of

the land in the ZoI is owned by private mining

companies, private and commercial farm owners

and Eskom. The Komati ZoI is approximately two

thirds urban and one third rural; however, the urban

population are concentrated in Komati, in the north

of the ward. Apart from Komati town, households

are largely located on farms and disbursed.

The ward is small and land area is largely occupied by Komati Mine and power station in the north and

farms elsewhere. The settlement pattern has been largely influenced by mining and agriculture in the

area. Important road service infrastructure in and outside of the ZoI includes the R35 and the R542. A

Google Earth image from April 2016 is provided in Figure 3-10.

10 Ibid (Eskom 2016)

While Komati village and Blinkpan are

considered the host communities, and

Hendrina fall into the secondary ZoI.

Adjacent farmers are also considered to

be part of the primary ZoI.



ESKOM SOCIAL BASELINE KOMATI ZOI LOCALITY

Project No. 506503

Figure 3-10: Komati ZoI locality

Source: Google Earth, 16 April 2016.

3.3.4 Camden ZoI

Overview

Camden power station is located approximately

19km South-East of Ermelo within Ward 11 of

the Msukaligwa Local Municipality.

The first of eight units at Camden power station

was originally commissioned in 1967. The

power station is due to be decommissioned in

2030.11 Many parts of the power stations,

including the boilers, have already passed their

anticipated life cycle.

Camden acquires its coal supply from outlying

mines, and as such is required to transport their

coal supply via road and conveyor.

Figure 3-11: Camden power station

11 Ibid (Eskom 2016)




The Camden ZoI is bordered to the northwest by Ermelo, an economic hub. It is bordered to the east

by intensive forestry activities, which also occur in the surrounds of Sheepmoor and eastern parts of

Camden ZoI itself. The national, provincial and district roads N2, N11 R39 and R65 are the primary

transport routes in the Camden ZoI but have not resulted or stimulated ribbon development to any

degree, probably due to the agricultural focus in the area and the multitude of informal secondary sand

tracks that link homesteads and communities.

The Camden ZoI is 50:50 rural and urban. The

highest concentration of the population is within the

settlements of Camden and Sheepmoor, with

disbursed farm settlements throughout. Farming is

the predominant land use in the area and as such,

farm and homesteads are the typical settlement

types in the area, with limited urban infrastructure

and services outside of Camden and Sheepmoor. A

Google Earth image from August 2016 is provided

in Figure 3-12.

ESKOM SOCIAL BASELINE CAMDEN ZOI LOCALITY

Project No. 506503

Figure 3-12: Camden ZoI locality

Source: Google Earth, 15 August 2016.

Camden Village and Sheepmoor are

considered the host communities of the

Camden power station. However, adjacent

farmers are also considered to fall within

the primary ZoI, with Ermelo and its

surrounds, falling into the secondary ZoI.

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

29

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Tab

le 3

-2:

So

cio

-eco

no

mic

su

mm

ary

of

the f

ou

r lo

cal Z

oIs

Hen

dri

na Z

oI

Arn

ot

Zo

I K

om

ati

Zo

I C

am

den

Zo

I

T

he p

opula

tion

siz

e is 2

8 2

87;

It is m

ade u

p la

rgely

of

Bla

ck A

fric

an p

eop

le;

T

here

are

marg

inally

more

male

s t

ha

n f

em

ale

s;

T

he m

ajo

rity

of

the p

opula

tio

n a

re u

nder

the a

ge o

f 3

5

ye

ars

an

d t

he Z

oI

has a

n o

ve

rall

yo

ung p

op

ula

tion.

T

he p

opula

tion

siz

e is 5

817;

It is m

ade u

p la

rgely

of

Bla

ck A

fric

an p

eop

le;

T

here

are

marg

inally

more

male

s t

ha

n f

em

ale

s;

T

he m

ajo

rity

of

the p

opula

tio

n a

re u

nder

the a

ge o

f 35

ye

ars

an

d t

he a

rea c

an b

e c

lassifie

d a

s b

ein

g a

n o

vera

ll yo

un

g p

opula

tion.

T

he p

opula

tion

siz

e is 5

010;

It h

as a

majo

rity

Bla

ck A

fric

an

popu

lation;

T

here

are

more

male

s t

ha

n f

em

ale

s,

whic

h s

upp

ort

s t

he

conclu

sio

n t

hat

mig

ratio

n is h

igh in t

he a

rea;

T

he

popula

tio

n

spik

es

in

the

work

ing

age

gro

ups,

part

icu

larl

y a

mongst

the 2

0-3

4 y

ear

gro

up.

T

he p

opula

tion

is 7

269;

It h

as a

majo

rity

Bla

ck A

fric

an

popu

lation;

T

here

are

marg

inally

more

fem

ale

s t

ha

n m

ale

s;

T

he m

ajo

rity

of

the p

opula

tio

n a

re u

nder

the a

ge o

f 35

ye

ars

a

nd

the

are

a

there

fore

h

as

an

overa

ll you

ng

pop

ula

tion.

A

n i

ncre

ase i

n t

he p

opula

tio

n i

s e

vid

ent, d

ue t

o t

he i

n-

mig

ratio

n o

f pe

ople

fro

m t

he g

reate

r M

pum

ala

ng

a r

eg

ion

and fro

m n

eig

hbouri

ng S

outh

ern

Afr

ican c

oun

trie

s, a

s w

ell

as t

he n

atu

ral in

cre

ase in t

he s

ize o

f fa

mili

es;

T

he p

ort

ion o

f th

e p

opu

latio

n l

eavin

g t

he a

rea i

s t

hose

age

d b

etw

een 1

6 a

nd 2

5,

most

who l

eave i

n a

n e

ffort

to

find e

mp

loym

ent

els

ew

here

.

In

te

rms of

mig

ratio

n in

to th

e A

rnot

ZoI, it is

m

inim

al.

Ho

wever,

m

igra

nts

have

been

identified

as

larg

ely

fo

reig

ners

in

searc

h

of

livin

g

space

and

em

plo

ym

ent

opp

ort

unitie

s.

M

igra

tio

n h

as b

ee

n s

ignific

an

t and g

rad

ually

gro

win

g i

n

the K

om

ati Z

oI sin

ce 2

007. A

lthou

gh s

om

e m

igra

nts

have

com

e f

rom

within

So

uth

Afr

ica,

the m

ajo

rity

have c

om

e

from

outs

ide o

f S

outh

Afr

ica.

T

here

had

been

an

incre

ase

in

the

Cam

den

ZoI

pop

ula

tion;

M

igra

tio

n s

tatistics a

ppe

ar

to b

e i

ncom

ple

te f

or

Sta

tsS

A

Census

20

11

sta

tistics

sug

gest

there

ha

ve

be

en

no

mig

ratio

ns into

the C

am

den Z

oI

betw

een 2

007 a

nd 2

01

1;

ho

we

ver,

th

is

is

unlik

ely

if

com

pare

d

with

mig

ratio

n

pattern

s in

surr

oun

din

g w

ard

s and w

ithin

M

pum

ala

nga

pro

vin

ce.

T

he m

ajo

rity

o

f housin

g in

th

e H

endri

na Z

oI

is fo

rmal

housin

g (

brick s

tructu

res o

n a

separa

te s

tan

ds o

r yard

s),

ho

we

ver

seco

nd

to

this

is

in

form

al

dw

elli

ngs,

larg

ely

shacks;

In

flu

x and po

pula

tion gro

wth

has le

d to

an in

cre

ase in

in

form

al

dw

elli

ngs i

n i

nfo

rmal

settle

ments

and o

n f

arm

s,

wh

ich c

an b

e a

ttribute

d t

o t

he l

abo

ur

inte

nse i

ndustr

ies,

inclu

din

g m

inin

g a

nd e

nerg

y g

en

era

tio

n,

in t

he H

en

dri

na

Z

oI.

P

rim

ary

la

nd

use

in

the

A

rnot

ZoI

is

mostly

form

al

resid

entia

l;

T

he m

ajo

rity

of

housin

g in t

he A

rnot

ZoI

is f

orm

al ho

usin

g

or

brick s

tructu

res o

n s

ep

ara

te s

tands o

r yard

s,

ho

we

ver

second t

o t

his

is info

rmal d

we

llin

gs,

larg

ely

sh

acks.

Influ

x

and p

op

ula

tion

gro

wth

has l

ed t

o a

n i

ncre

ase i

n i

nfo

rma

l d

welli

ngs i

n i

nfo

rmal

settle

me

nts

an

d o

n f

arm

s.

This

can

be attribute

d to

th

e la

bo

ur

inte

nse in

dustr

ies,

inclu

din

g

min

ing a

nd e

nerg

y g

enera

tio

n,

in t

he A

rnot

ZoI.

K

om

ati

ZoI

has

varied

lan

d

uses,

most

of

wh

ich

is

resid

entia

l. H

igh i

nfo

rma

l a

nd

form

al

resid

en

tial

pattern

s

sugg

est th

at in

-mig

ratio

n is s

ignific

ant, a

nd the incre

asin

g

pop

ula

tion h

as le

d to

urb

an spra

wl

and th

e gro

wth

o

f in

form

al settle

ments

, w

here

mo

st

occupa

nts

are

rentin

g;

T

he

majo

rity

of

houses

are

fo

rmal

hou

sin

g

or

brick

str

uctu

res a

s w

ell

as i

nfo

rma

l d

we

llin

gs,

larg

ely

sh

acks,

man

y o

f w

hic

h a

re t

o b

e f

ou

nd

in K

om

ati.

C

am

den Z

oI

has m

ore

desig

nate

d f

arm

land

than a

ny o

f th

e o

ther

thre

e Z

oI’s. T

he r

em

ain

ing tw

o thir

ds o

f la

nd u

se

is f

orm

al re

sid

entia

l. A

t a t

hir

d o

f th

e p

opula

tion (

67.0

%),

th

e C

am

den Z

oI als

o h

as the h

ighest num

be

r of re

sid

ents

liv

ing r

ent

free (

mostly f

arm

work

ers

);

T

he m

ajo

rity

of

housin

g in

th

e C

am

den Z

oI

is fo

rmal

housin

g

mad

e

of

brick

on

separa

te

sta

nds

or

yard

, ho

we

ver,

tra

ditio

na

l dw

elli

ngs a

re the n

ext m

ost pre

vale

nt;

P

opu

latio

n

gro

wth

h

as

led

to

an

incre

ase

in

in

form

al

dw

elli

ngs in info

rmal settle

me

nts

and o

n farm

s, w

hic

h c

an

als

o be attribu

ted to

season

al

farm

w

ork

and e

x-f

arm

em

plo

yees

co

ntinu

ing

to

resid

e

on

farm

s

follo

win

g

term

ination o

f em

plo

ym

ent.

T

rends s

uggest th

at unem

plo

ym

ent in

the H

endri

na Z

oI is

m

odera

te,

ho

wever

only

clo

se o

n h

alf o

f th

e w

ork

ing

age

pop

ula

tion

is

em

plo

ye

d.

In

additio

n,

a

third

of

the

pop

ula

tion is n

ot

econom

ically

active;

M

ore

than h

alf o

f th

ose e

mplo

yed a

re e

mp

loyed i

n t

he

fo

rmal

secto

r. T

he

info

rmal

secto

r pro

vid

es

sig

nific

ant

em

plo

ym

ent

at

clo

se

on

a

third

of

em

plo

ym

ent

opp

ort

unitie

s;

A

bout

one i

n t

en h

ouseho

lds i

n t

he H

endri

na Z

oI

do

not

earn

an

y inco

me.

U

nem

plo

ym

ent in

the A

rnot Z

oI is

modera

te, ho

wever

only

40.0

% o

f th

e w

ork

ing a

ge p

opu

latio

n i

s e

mplo

ye

d,

an

d

40.0

% o

f th

e p

opu

latio

n is n

ot

econom

ically

active;

T

he vast

majo

rity

of

the pop

ula

tion is

em

plo

yed in

th

e

form

al secto

r;

C

lose o

n t

hre

e q

uart

ers

of

the h

ouseh

old

s e

arn

betw

een

R

19 6

01.0

0 a

nd R

307 6

00.0

0 a

nn

ually

. H

ow

ever,

a t

hir

d

of househo

lds a

re c

om

pri

se

d o

f one p

ers

on, and a

s s

uch,

dep

en

dency is

possib

ly lo

we

r th

an oth

er

wa

rds in

th

e

munic

ipa

l are

a.

T

he K

om

ati Z

oI

has t

he l

ow

est

level

of

not

econ

om

ica

lly

active

pop

ula

tion

com

pare

d

to

the

thre

e

oth

er

ZoI’s.

Em

plo

ym

ent

is estim

ate

d at

clo

se on half of

the a

dult

pop

ula

tion;

M

an

y o

f th

ose e

mplo

yed in t

he K

om

ati Z

oI

are

em

plo

ye

d

on f

arm

s;

T

he f

orm

al secto

r accounts

fo

r 80.0

% o

f th

e e

mplo

yed;

O

ne in

fiv

e h

ou

seho

lds d

o n

ot earn

an a

nn

ua

l incom

e, w

ith

clo

se o

n t

wo t

hirds o

f house

hold

s e

arn

ing a

n i

ncom

e o

f betw

een R

19 6

01.0

0 a

nd R

15

3 8

00.0

0 a

nnu

ally

.

U

nem

plo

ym

ent

in t

he C

am

de

n Z

oI

is lo

w,

with o

ne in

fiv

e

of

the a

du

lt p

opula

tion n

ot

econom

ically

active;

T

he m

ajo

rity

of

those e

mplo

yed i

n t

he C

am

den Z

oI

are

th

oug

ht

to b

e e

mplo

ye

d o

n f

arm

s;

O

ne in t

en o

f h

ouse

hold

s in t

he C

am

den Z

oI

do n

ot

earn

an

y incom

e,

an

d o

ne in f

ive e

arn

betw

een R

9 6

01.0

0 a

nd

R

38 2

00.0

0 a

nnua

lly.

Clo

se o

n h

alf o

f househo

lds h

ave

fo

ur

or

more

occup

ants

, an

d

as

such

the

househ

old

in

com

es are

often str

etc

hed and in

suffic

ien

t to

sup

port

w

hole

ho

use

ho

lds.

Hen

drin

a

Pow

er

sta

tion

curr

ently

em

plo

ys

690

peo

ple

, of w

hic

h 6

65 a

re p

erm

ane

nt. T

he m

ajo

rity

of

the

em

plo

yee

s

(97%

) are

lo

cally

sourc

ed

from

Pulle

ns H

ope.

Of

em

plo

ye

es,

76%

are

male

while

24%

are

fem

ale

. E

skom

, 20

16.

Arn

ot

curr

ently h

as 7

10 e

mplo

yees.

The m

ajo

rity

of

em

plo

yees (

93

%)

resid

e i

n R

ietk

uil.

Ap

pro

xim

ate

ly

27%

are

fem

ale

and 6

3%

ma

le.

Eskom

, 20

16.

Kom

ati p

ow

er

sta

tion c

urr

ently e

mplo

ys 4

70 p

eo

ple

,

of

whic

h 35

2 are

p

erm

an

ent.

T

he m

ajo

rity

of

the

em

plo

yees (

43

9)

are

sourc

ed fro

m E

mala

hle

ni. 6

7%

of

em

plo

yees

are

m

ale

w

hile

33

%

are

fe

ma

le.

Eskom

, 2

016.

Ca

md

en

curr

ently

has

373

em

plo

yees,

321

of

whic

h a

re p

erm

ane

nt. T

he m

ajo

rity

of

em

plo

yees

(351)

resid

e

in

Erm

elo

. A

ppro

xim

ate

ly

35

%

are

fem

ale

and 6

5%

ma

le.

Esko

m,

20

16.

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

30

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Hen

dri

na Z

oI

Arn

ot

Zo

I K

om

ati

Zo

I C

am

den

Zo

I

E

ducation l

eve

ls i

n t

he H

endri

na Z

oI

are

rela

tively

hig

h.

The m

ajo

rity

of

the p

opula

tion

have a

secon

dary

sch

oo

l educatio

n (

just

over

ha

lf);

O

nly

3%

of

the c

om

munity o

ver

the a

ge o

f 20 h

ave a

ny

form

of

tert

iary

educatio

n.

E

ducation l

eve

ls i

n t

he A

rnot

ZoI

are

rela

tively

hig

h w

ith

abo

ut 10

% o

f com

munity m

em

bers

over

the

age o

f 20 n

ot

havin

g

an

y

form

of

education.

Clo

se

on

half

of

the

pop

ula

tion (

50

%)

has a

seco

ndary

scho

ol e

ducation.

The

more

co

ncern

ing facto

r in

th

e A

rnot Z

oI is

th

e fact th

at le

ss

than 5

% o

f th

e p

eo

ple

over

the a

ge o

f 2

0 h

ave a

ny f

orm

of

tert

iary

education.

O

f th

e

peop

le

over

the

ag

e

of

20,

67

%

com

ple

ted

secondary

school.

Lik

e

many

wa

rds

in

the

pro

vin

ce

, te

rtia

ry e

ducation s

uccess is d

ire;

It

appears

th

at

there

is

a

prim

ary

scho

ol

(La

ers

ko

ol

Koorf

onte

in)

in K

om

ati V

illag

e.

A

ppro

xim

ate

ly

20%

of

the

pop

ula

tion

have

a

prim

ary

educatio

n a

nd a

seco

nd

ary

schoo

l e

ducatio

n.

The m

ore

concern

ing f

acto

r in

the Z

oI

is t

he f

act

that

only

0.5

% o

f th

e c

om

mu

nity o

ver

the

ag

e o

f 20 h

ave a

ny form

of te

rtia

ry

educatio

n;

T

here

are

at le

ast tw

o p

rim

ary

schools

and o

ne s

econ

dary

schoo

l in

Sh

ee

pm

oor.

T

here

is n

o h

ospital in

the Z

oI, w

ith t

he c

lose

st

hospital in

E

mala

hle

ni

so

me 4

6 k

m a

wa

y.

There

are

tw

o c

linic

s i

n

Hen

drin

a a

nd o

ne in P

ulle

nshop

e.

T

here

is

no hospita

l in

th

e A

rnot

ZoI, w

ith th

e clo

sest

hosp

ital

in M

iddle

burg

(5

3km

aw

ay).

There

is a

clin

ic i

n

Rie

tkuil.

T

here

is n

o h

ospita

l in

th

e K

om

ati Z

oI

an

d t

he n

eare

st

hosp

itals

are

E

mala

hle

ni,

40

km

, B

eth

al,

43

km

and

E

mala

hle

ni, 4

5km

. T

here

is a

clin

ic in K

om

ati.

T

he clo

sest

hospita

l to

th

e C

am

den Z

oI

is lo

cate

d in

E

rmelo

, som

e

20km

a

wa

y.

There

is

als

o

a

clin

ic

in

Shee

pm

oor.

T

he m

ajo

rity

of

househ

old

s in

th

e H

endri

na Z

oI

have

either

munic

ipal

or

private

re

fuse

rem

oval

serv

ices.

Curr

ently

He

ndrin

a

po

we

r sta

tion

pro

vid

es

all

refu

se

re

moval

serv

ices in

P

ulle

nsh

ope and th

e W

oesta

llee

n

min

es. T

he p

ow

er sta

tion a

lso u

tilis

es the

ir o

wn la

ndfill

site

fo

r w

aste

dis

po

sal;

F

lushin

g t

oile

ts a

re u

tilis

ed b

y 6

7%

of

the h

ou

seho

lds;

C

lose

on

all

the

househ

old

s

have

access

to

a

wate

r conn

ectio

n e

ith

er

in th

eir y

ard

, w

ithin

their d

welli

ng o

r at a

com

mun

al sta

ndpip

e;

E

skom

is

th

e sole

dis

trib

uto

r of

bulk

ele

ctr

icity in

th

e

Hen

drin

a Z

oI

and e

lectr

ical

conn

ectio

ns a

re p

revale

nt

in

the a

rea,

part

icula

rly in P

ulle

nshop

e a

nd H

en

drin

a t

ow

n;

T

he m

ajo

rity

o

f house

ho

lds in

th

e Z

oI

have access to

m

unic

ipa

l ele

ctr

icity;

T

he m

ajo

rity

of

house

ho

lds r

ely

on e

lectr

icity f

or

cookin

g,

heating,

an

d lig

hting.

T

he m

ajo

rity

of

househ

old

s i

n t

he A

rnot

ZoI

have e

ither

munic

ipa

l or

pri

vate

refu

se r

em

oval serv

ices;

S

anitation s

erv

ices a

re i

mpro

ved a

nd f

lush

ing t

oile

ts a

re

utilis

ed b

y ju

st

over

two qua

rters

of

the househ

old

s in

A

rno

t Z

oI;

C

lose

on

all

househo

lds

have

access

to

a

wate

r conn

ectio

n e

ith

er

in th

eir y

ard

, w

ithin

their d

welli

ng o

r at a

com

mun

al sta

ndpip

e;

E

skom

is the s

ole

dis

trib

uto

r o

f bulk

ele

ctr

icity in the A

rnot

ZoI: T

he m

ajo

rity

of ho

use

hold

s in the Z

oI have a

ccess to

m

unic

ipa

l ele

ctr

icity;

T

he m

ajo

rity

of

househo

lds r

ely

on e

lectr

icity f

or

cookin

g,

heating,

an

d lig

hting.

R

efu

se d

isposal b

y t

he m

unic

ipalit

y o

r private

com

pan

ies

is a

fford

ed to h

alf o

f th

e h

ouse

hold

s, and is fo

cused in the

urb

an

pockets

of

the

Kom

ati

ZoI

(inclu

din

g

Kom

ati

Vill

age);

S

anitation in t

he K

om

ati Z

oI

is d

iffe

rent

in v

arious p

laces,

with

urb

an

pockets

enjo

yin

g

better

serv

ices

whe

n

com

pare

d

to

rura

l a

nd

info

rmal

settle

me

nts

. F

lushin

g

toile

ts a

re u

tilis

ed b

y a

bout

50

% o

f th

e h

ouse

hold

s;

A

bout

67%

o

f househo

lds

have

access

to

a

wate

r conn

ectio

n e

ith

er

in t

heir y

ard

or

within

their d

we

llin

g;

E

skom

is

th

e sole

dis

trib

uto

r of

bulk

ele

ctr

icity in

th

e

Kom

ati Z

oI;

E

lectr

icity

is

availa

ble

and

used

by

over

50

%

of

househ

old

s f

or

cookin

g,

heating a

nd lig

htin

g.

Ho

wever,

in

th

e i

nsta

nce o

f heating,

20

% o

f househo

lds d

o n

ot

use

ele

ctr

icity, and c

and

les s

till

account fo

r a la

rge p

erc

enta

ge

of

lighting in t

he K

om

ati Z

oI.

33%

of

ho

useho

lds

in

the

C

am

den

ZoI

have

eith

er

munic

ipa

l or

private

re

fuse

rem

ova

l serv

ices,

conce

ntr

ate

d in t

he u

rba

n p

ockets

of

Cam

den;

P

it

latr

ines

are

th

e

dom

ina

nt

sanitation

meth

od

for

househ

old

s, an

d a

s m

an

y a

s o

ne in

fiv

e h

ouse

hold

s (20%

) had n

o s

an

itation f

acili

ties;

C

lose o

n 5

0%

of househ

old

s d

o n

ot have a

ccess to p

iped

w

ate

r; th

e re

st

of

househ

old

s have access to

a w

ate

r conn

ectio

n e

ith

er

in th

eir y

ard

, w

ithin

their d

welli

ng o

r at a

com

mun

al sta

ndpip

e;

E

skom

is t

he

sole

dis

trib

uto

r of

bulk

ele

ctr

icity.

Ho

we

ver,

ele

ctr

ical

conn

ections are

no

t w

ide

ly pre

va

lent

due

to

dis

burs

ed s

ettle

ment

an

d t

he r

ura

lity o

f fa

rms;

T

he m

ajo

rity

of househ

old

s in

the Z

oI do n

ot use m

unic

ipal

ele

ctr

icity f

or

cookin

g a

nd h

eating;

T

he m

ajo

rity

of

househ

old

s r

ely

on w

ood f

or

cookin

g a

nd

heating;

T

he m

ajo

rity

of

house

ho

lds r

ely

on e

lectr

icity f

or

lighting;

C

an

dle

s a

re a

sig

nific

ant

sourc

e o

f lig

hting.

Curr

ently a

ll se

wera

ge f

rom

Pulle

nsh

op

e is t

reate

d

at

the H

en

drin

a w

ate

r tr

eatm

ent

work

s –

Hendri

na

pow

er

sta

tion,

201

6.

Hen

drin

a c

urr

ently p

rovid

es b

oth

Pulle

nsh

op

e a

nd

Woesta

lleen m

ine w

ith p

ota

ble

wate

r an

d e

lectr

icity

– H

en

drin

a p

ow

er

sta

tion,

2016.

Kom

ati c

urr

ently p

rovid

es b

oth

wate

r and e

lectr

icity

to t

he K

om

ati V

illa

ge –

Kom

ati p

ow

er

sta

tion

, 2016.

Curr

ently,

the l

ocal

mu

nic

ipa

lity i

s r

esponsib

le f

or

sanitation p

rovis

ion a

nd s

erv

ices i

n B

linkpa

n a

nd

Kom

ati V

illag

e –

Ko

mati p

ow

er

sta

tion,

201

6.

Despite a

rela

tively

hig

h e

ducation level in

the a

rea,

Hen

drin

a c

urr

ently s

truggle

s t

o s

ourc

e t

he r

equir

ed

skill

s f

rom

the local co

mm

unitie

s –

Hendri

na p

ow

er

sta

tion,

20

16.

Despite

a

po

sitiv

e

educatio

n

level

in

the

are

a,

Kom

ati curr

ently str

uggle

s to

sourc

e th

e re

quir

ed

skill

s f

rom

th

e l

oca

l co

mm

un

itie

s –

Ko

mati p

ow

er

sta

tion,

20

16.



Relevant Strategies and Plans

The development of criteria to assess options need to consider relevant strategies and plans. This

section outlines Eskom’s Socio-economic Development (SED) scope; the CSI activities of the four

power stations, followed by the LEDs of the municipalities in question, the Provincial Growth and

Development Strategy (PGDS), where after the relevant NDP and SDGs are outlined. The linkage of

the SDGs with the option selection criteria as defined in section 5 is outlined in Table 3-3.

3.4.1 Eskom’s SED and CSI Plans

Eskom’s SED Scope

Eskom’s SED scope includes initiatives, which address the following (Integrated Socio-economic

Development Policy for Eskom, 240-69723512, November 2013):

Community development;

Education;

Employment creation;

Skills development;

Technology development and access to technology;

Health;

Wealth and income creation;

Social investment; and,

Stakeholder engagement.

Of the SDGs identified (Table 3-3), Goal 1 “End poverty”, Goal 4 “Inclusive and equitable quality

education”, Goal 3 “Ensure healthy lives and promote well-being for all”, and Goal 9 “Build resilient

infrastructure” have relevance to the Eskom SED scope.

Eskom Power Stations’ SED/CSI

The four power stations have approximately R1 million annually to spend on CSI. In addition, the

Eskom Foundation also contributes R34 million per annum for SED. The focus on CSI spend leans

towards education, skills development and community development:

Hendrina’s main LED activity is the air emissions off-setting project, which involves providing

energy efficient coal burning stoves in Kwazamakhule. In addition, funding is provided to local

home-based care programmes. The power station is looking at opportunities to utilise the ash to

start brick manufacturing, and to formalise the collection of rubbish at the landfill site for recycling.

There are ongoing requests for transport from the surrounding communities.

Arnot currently has over R9 million in CSI activities earmarked for local school refurbishment and

the construction of computer labs, funding and donations to orphanages and old age homes, and

support to clinics, hospice, mobile clinics and home based care. Through the Eskom Foundation,

there is also a Contractor Academy on site who assist learners with the development of key skills,

including artisans and operators. The academy takes approximately 25 students per 18-month

cycle, to secure funding for initiatives such as education (school refurbishment, computer labs).

Komati provides donations to approved applicants. Current CSI initiatives include the construction

and maintenance of boreholes, provision of school uniforms and construction of bus shelters.

Where possible support to local farm schools is prioritised.



Camden provides donations to approved applicants. Camden has provided computers to Cebisa

secondary school and assisted Netherlands Park, as well as chairs, projectors, interactive boards

etc. to local primary and secondary schools, and donations to a local day care center.

The Eskom Foundation is also involved in initiatives such as Health Mobile Clinics, Maths Centre

for Professional Teachers, Contractor Academies, Eskom expos, etc. A welding programme to the

value of R1 434 098, was conducted for 28 community members from Ermelo to empower these

members to become employable. They were trained in basic welding training. Further training was

requested, and 18 members completed the full course. Their details were given to the power

stations to look at possible employment (Eskom Foundation Presentation, 10 July 2016).

3.4.2 Municipalities’ Local Economic Development

Nkangala District Municipality (Final Draft Integrated Development Plan (IDP) 2016/17-2020/2021)

To enhance local economic development, the focus is on job creation and poverty alleviation through:

Economic diversification;

Marketing and market research;

Institutional development;

Green economy mainstreaming; and,

Business retention, attraction and development.

Anchor projects identified by the district municipality for Steve Tshwete Local Municipality are:

Establishment of a catalytic converter plant; and,

Establishment of a steel and metal fabrication hub.

Anchor projects in other municipalities within Nkangala District Municipality are: establishment of a

glass recycling plant, bio diesel plant, shopping complex, sawmill project, fly ash beneficiation plant,

high altitude sport centre, international airport, Small Medium Macro Enterprises (SMME) hub,

business convention centre, tourism belt, mining museum and convention centre, and a theme park

development.

Current strategies and plans for the district include:

Feasibility study for an agro-processing plant;

Develop and review LED strategies;

Development of investment attraction and promotion strategies;

Feasibility study for integrated rural development strategy;

Business plan for fresh produce market (agri-hub);

Anchor projects completed; and,

Feasibility study for the fresh produce market completed.



Relevant sector specific strategies are listed as follows:

Tourism strategy

The following clusters have been identified to improve the tourism spread: Mining cluster; Eco-nature

cluster; Cultural, historic and political cluster; and, Conference and convention cluster.

Industrial strategy

The following industrial clusters are planned: Food and beverages; Non-metallic mineral products;

Metal and products of metal; Support for the ICT; and, SMME development.

Regional industrial roadmap

This roadmap provides a guideline that will stimulate industrial development and a focused approach

to economic development.

Sector interventions

Agriculture, hunting, forestry and fishing interventions: Integrate current small-

scale/emerging farmers into the commercial farming arena;

Mining: Small-scale mining, mine rehabilitation and mine procurement.

Food products, beverages and tobacco products interventions: Promote agro-processing.

Textiles, clothing and leather goods interventions: Develop a business plan for the

establishment of organic cotton textiles and clothing community hubs.

Wood and products of wood, manufacture of articles of straw, manufacture of paper and

paper products: Develop furniture training centres in appropriate local municipalities.

Agro-Pharmaceuticals: Develop an agro- pharmaceutical cluster; pharmaceuticals should focus

on developing country illnesses.

Chemicals: Undertake a feasibility study to determine which products are appropriate for

manufacturing in Nkangala.

Machinery: Determine the feasibility of machinery manufacturing.

Automotive industry: Conduct a market analysis to determine whether there will be a demand

for Nkangala’s exhaust systems.

Tourism: A study must be conducted to determine the status quo.

Corridor development opportunities

The N4 Maputo Corridor, N12 Corridor, and the Moloto Corridor hold significant opportunities for the

Nkangala District area, both in terms of economic spin-offs from the corridor, and tourism potential.

Development along these corridors could include intensive agriculture, agro-processing and hospitality

uses. The significance of the railway lines in the district in terms of export opportunities to the Maputo

and Richards Bay harbours is also investigated.



Gert Sibande District Municipality (IDP 2016-2017)

Key sectors driving the economy of the district have been identified as:

Manufacturing;

Mining;

Energy generation and supply;

Agriculture;

Forestry;

Tourism; and,

Transportation and logistics.

In terms of local economic development, the strategies are seated in the following areas:

Development and support for the agricultural sector

Establishment of commercial farmers;

Agro-processing facilities; and,

Establishment of a fresh produce market is being considered to take advantage of value chain

opportunities that it presents, e.g. storage, warehousing, transportation, and packaging.

Development Agency

The intention is to establish the Gert Sibande District Municipality Development Agency to ensure

strategic focus to deliver the municipality’s mandate for LED.

Potential Economic Development Corridors

Towns and settlements are to be linked to encourage economic development opportunities. Strategic

road and rail networks are to be maintained to support internal and external linkages.

Strategic Development Initiatives

A number of strategic development studies are discussed in the IDP, these being:

Heyshope Dam scoping study;

District Industrial Development Strategy, focusing on chemicals, plastic fabrication, and

pharmaceuticals. Industrial zones and workshops as part of the development initiatives are

mentioned;

Capital or transport equipment and metals sector development;

Mining Beneficiation Masterplan to encourage benefits and economic empowerment to the

surrounding communities;

New regional information management and tourism exhibition centre, since tourism is rated high

in the Mpumalanga Provincial Economic Growth Strategy. Linked to this is responsible tourism

development and support and the development of a regional library and exhibition centre;

Development of a district biodiesel plant;

SMME/Co-operatives Development Support;



Development of a regional airport (Ermelo);

Promotion of urban renewal programmes within the municipality;

Promotion of the expansion of the greening economy in the district, since the municipality falls in

the Highveld’s high intervention priority area in regard. Environmental degradation because of

coal-fired power station is mentioned as one of the drivers for the promotion of clean energy

generation. In this regard, the implementation of the Air Quality Management Plan and Pollution

Control Plan have been identified as a key performance indicator to advance community well-

being;

Regional training (skills development);

Establishment of a Regional Sports Complex;

Building more united, non-racial, integrated and safer communities; and,

Comprehensive Rural Development Programme.

Steve Tshwete Local Municipality (IDP 2012-2017)

The following initiatives are of importance:

The municipality sold a total of 37 industrial sites, and the plan is to make more sites available. A

site for an industrial park has been made available. The municipality wants to specifically focus on

enhancing the stainless steel sector in Emalahleni.

In line with the district, the municipality plans to develop a green economy policy, as well as draft

green building guidelines.

Part of the local economic development strategy is to develop agriculture. The promotion of

Hydroponic farming is considered. Community Garden Projects was developed with 27

beneficiaries sponsored by Black Wattle Mine.

Developing a strong SMME sector is a focus area, with specific focus on establishing the following

hubs: industrial, agricultural, steel and metal fabrication, logistical. The intention is to make more

land available to SMMEs. New malls are planned for Mhluzi and Emalahleni. Land for industrial

stands will be acquired.

Msukaligwa Local Municipality (IDP 2016-2017)

The following plans are identified as key to economic development in the municipality:

SMME and community development support: The municipality and private sector to work together

to develop SMME.

Future local economic development projects (subject to availability of funding): The municipality

has applied for funding at the Department of Environmental Affairs to implement environmental

protection and infrastructure projects as part of the Greening Flagship projects.

Regional fruits and vegetables cold storage and distribution centre: Through funding assistance,

establish a regional fruits and vegetables cold storage and distribution centre, which will assist

small-scale producers with market opportunities.

Chicken abattoir: investigate the establishment of a regional chicken abattoir and cold storage to

support small-scale chicken producers.



Municipalities’ Electricity Situation and its Influence on the Execution of LED

The indication is that the successful implementation of the plans outlined in the IDPs rely on the coal-

fired power station operations continuing, and no consideration is given to the discontinuation of these

power stations.

Nkangala District Municipality

The IDP (2016/17-2020/2021) acknowledges that the security of coal supply for some existing coal

power stations is increasingly under threat due to better returns for coal miners through exports to

India and other Asian countries. The IDP (2016/17-2020/2021) also highlights that a reliable electricity

supply depends on a sufficient number of functioning power stations, and a reliable grid network.

Increasing local supply failures in some areas requires a more pragmatic corrective approach,

according to the IDP (2016/17-2020/2021). Strategic interventions mentioned are the Kusile project

and the Komati power station.

Gert Sibande District Municipality

The Gert Sibande IDP (2016-2017) highlights key issues pertaining to electricity, and these are

summarised as follows:

Limited capacity is available to support new developments;

Backlogs are mostly as a result of informal settlements not yet proclaimed or where township

extensions are taking place;

New houses are not immediately electrified upon completion;

Electrification in rural areas has slowed down due to a focus on building bulk electrical

infrastructure which requires major funding; and,

Additional bulk infrastructure to eradicate backlogs are required.

Flagship projects that will be implemented as part of the Planning and Economic Development

Portfolio, when funds are available, include Chief Albert Luthuli wind energy project, Mkhondo hydro

electrical power plant, and power generation from solid waste through gasification.

The IDP (2016-2017) reports that coal haulage trucks transporting coal from the mines to four power

stations within the municipal area cause damage to the roads. Maintenance requirements of these

roads place additional stress on the budget up to national and provincial level. Strategies are to reduce

the number of trucks on the road, improve on overload monitoring, and support the rail developments.

Steve Tshwete Local Municipality and Msukaligwa Local Municipality

The IDPs of the two local municipalities relevant to this study, i.e. Steve Tshwete Local Municipality

(IDP, 2012-2017) and Msukaligwa Local Municipality (IDP, 2016-2017), mainly refer to the challenges

related to the electrification of informal settlements, and provision of electricity to rural households.

Maintenance of infrastructure remains a challenge, more so of aging infrastructure.

Steve Tshwete Local Municipality’s IDP (2012-2017) reports that bulk electricity purchases remain the

main increasing factor on operating expenditure totalling R2,7-billion over the next five (5) years with

an average rate increase of 12%. The provision of electricity is guided by the Electricity Master Plan

that was developed and adopted in 2006. Eskom supplies electricity to the rural and farm dweller

homes.



A shortage of electrical supply capacity from Eskom to newly built council substations is reportedly a

challenge. The municipality is in the process of upgrading the main electrical intake substations to

Emalahleni, Hendrina, Kwazamokuhle, and Gholfsig. Two new intake substations are being erected

in Aerorand and Nasaret (Steve Tshwete IDP, 2012-2017).

Msukaligwa IDP (2016-2017) reports that there are no electricity supply backlogs, apart from provision

of electricity to rural households. The two main substations at Ermelo and Wesselton are reportedly

insufficient to meet demand, and the supply capacity has to be increased. To address this shortfall,

the municipality has commissioned a new substation at Ermelo extension 33. Load shedding is

identified as a threat to development, as well as rising Eskom tariffs.

3.4.3 Provincial Growth and Development Strategy

The PGDS is a strategic and integrated provincial development plan that provides direction and scope

for province-wide development programmes and projects, within the context of a long-term perspective

and taking into consideration resources available and constraints.

In essence then, the PGDSs are aimed at

providing strategic directives to district and

local municipalities in formulating their more

detailed IDPs, and Spatial Development

Frameworks (SDFs). It is thus essential that

the issues and directives emanating from

PGDSs be compatible with the vision,

priority areas, and guidelines of SDFs of

local and district municipalities.

Mpumalanga has identified six priority areas of intervention as part of the PGDS, namely:

Economic development (i.e. investment, job creation, business and tourism development and

SMME development);

Infrastructure development (i.e. urban/rural infrastructure, housing and land reform);

Human resource development (i.e. adequate education opportunities for all);

Social infrastructure (i.e. access to full social infrastructure);

Environmental development (i.e. protection of the environment and sustainable development);

and,

Good governance (i.e. effective and efficient public sector management and service delivery).

3.4.4 NDP Priorities and SDGs

The NDP envisages that by 2030 South Africa will have an energy sector that promotes economic

growth and development through adequate investment in energy infrastructure. The plan also

envisages that by 2030 South Africa will have an adequate supply of electricity and liquid fuels to

ensure that economic activity and welfare are not disrupted, and that at least 95.0% of the population

will have access to grid or off-grid electricity (South African Government, Pocket Guide to South Africa

2015-2016).

The NDP priorities and SDGs that are relevant to this study were identified in consultation with Eskom

and are listed in Table 3-3. The linkage of the SDGs with the option selection criteria as defined in

section 5 is illustrated in column 4 of Table 3-3.

.

A PGDS should build on the approach established

in the NDP and engage with both district and local

municipalities to deepen the sub-provincial

application of the NDP – Department of Provincial

and Local Government, 2005.

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

38

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Tab

le 3

-3:

Rele

va

nt

ND

P p

rio

riti

es a

nd

SD

Gs

Ke

y

Fo

cu

s

Are

aN

ati

on

al

Deve

lop

men

t P

lan

P

rio

riti

es (

ND

P)

Su

sta

inab

le D

eve

lop

me

nt

Go

als

(S

DG

s)

Im

pac

t A

ss

es

sm

en

t an

d O

pti

on

s A

naly

sis

cri

teri

a

So

cia

l

Socia

l P

rote

ction

Go

al

1:

End p

overt

y

Go

al

2:

End h

unger

and a

chie

ve f

ood s

ecurity

Em

plo

ym

en

t an

d p

rocu

rem

en

t: C

onsid

ers

the l

evels

of

em

plo

ym

ent

and

pro

cure

ment

at

each p

ow

er

sta

tion.

Natio

n B

uild

ing

and

Socia

l C

oh

esio

n

Go

al

5: G

ende

r equa

lity a

nd e

mpo

we

r w

om

en

and g

irls

Go

al

16:

Peacefu

l an

d inclu

siv

e s

ocie

ties

LE

D a

nd

CS

I: C

onsid

ers

the p

ow

er

sta

tion's

CS

I and L

ED

activitie

s.

Hum

an S

ettle

ments

G

oa

l 6:

Access t

o w

ate

r and s

anitation

Go

al

7:

Access t

o a

fford

able

, re

liable

and

susta

inable

en

erg

y

Go

al

11:

Inclu

siv

e c

itie

s a

nd h

um

an s

ettle

ments

Se

rvic

e D

eli

very

: C

onsid

ers

serv

ice d

eliv

ery

activitie

s o

f th

e p

ow

er

sta

tion.

These s

erv

ices inclu

de w

ate

r, e

lectr

icity,

san

itation,

an

d r

efu

se r

em

ova

l.

Consid

ers

the investig

atio

n o

f altern

ative e

ne

rgy o

ptio

ns t

o a

bate

em

issio

ns.

Reg

ion

al an

d N

ati

on

al E

nerg

y In

ve

stm

en

t: O

pport

unitie

s for in

vestm

ent in

to

rene

wa

ble

and

/or

altern

ative e

nerg

y o

ptions a

t a n

ation

al le

vel.

Healthcare

G

oa

l 3:

Ensure

health

y liv

es a

nd p

rom

ote

we

ll-bein

g f

or

all

LE

D a

nd

CS

I: C

onsid

ers

the p

ow

er

sta

tion's

CS

I and L

ED

activitie

s.

Education,

Tra

inin

g a

nd

Develo

pm

ent

G

oa

l 4: In

clu

siv

e a

nd e

qu

itable

qua

lity e

duca

tion

LE

D a

nd

CS

I: C

onsid

ers

the p

ow

er

sta

tion's

CS

I and L

ED

activitie

s.

Eco

no

mic

E

conom

y a

nd

Em

plo

ym

ent

G

oa

l 1:

End p

overt

y

Go

al

2:

End h

unger

and a

chie

ve f

ood s

ecurity

Em

plo

ym

en

t an

d p

rocu

rem

en

t: C

onsid

ers

the l

evels

of

em

plo

ym

ent

and

pro

cure

ment

at

each p

ow

er

sta

tion.

Econom

ic I

nfr

astr

uctu

re

Go

al

9:

Build

resili

ent

infr

astr

uctu

re

LE

D a

nd

CS

I: C

onsid

ers

the p

ow

er

sta

tion's

CS

I and L

ED

activitie

s.

Reg

ion

al

an

d

Nati

on

al

Co

ntr

ibu

tio

n:

Consid

ers

th

e

bro

ader

socio

-econ

om

ic i

mplic

ations o

f each o

ption s

uch a

s p

ressure

on t

he n

atio

na

l po

we

r gri

d, G

DP

contr

ibutio

n a

nd loca

l and r

egio

na

l econo

mic

multip

liers

.

Co

al

So

urc

ing

: C

onsid

ers

the v

ari

ous c

oa

l-sourc

ing o

ptions.

Part

icu

lar

attention is g

iven t

o t

ruckin

g o

f coal.

En

vir

on

men

t

Enviro

nm

enta

l S

usta

inabili

ty a

nd

Resili

ence

Go

al

13:

Action t

o c

om

bat

clim

ate

chan

ge a

nd its

im

pacts

Go

al

15:

Pro

tect

susta

inab

le u

se o

f te

rrestr

ial

ecosyste

ms,

mana

ge f

ore

sts

and p

reve

nt

land

degra

dation

En

vir

on

men

tal

Imp

acts

: C

onsid

ers

the p

ow

er

sta

tio

n's

enviro

nm

enta

l im

pacts

on t

he

socio

-econ

om

ic c

onte

xt

locally

, re

gio

nally

an

d n

ationa

lly.

Inclu

des a

ir e

mis

sio

ns,

wate

r pollu

tio

n,

wate

r usa

ge a

nd d

ust

ge

nera

ted

in

th

e utilis

atio

n of

PF

and C

FB

C te

chnolo

gie

s.

Con

sid

ers

th

e po

wer

sta

tions e

xcee

din

g t

he a

lloca

ted e

mis

sio

ns c

ap a

nd t

akin

g o

n a

larg

er

respo

nsib

ility

for

overa

ll em

issio

ns i

nto

the a

tmosph

ere

an

d t

he c

limate

chan

ge p

hen

om

eno

n.

Lan

d t

ake:

Co

nsid

ers

the p

ote

ntia

l fo

r la

nd t

ake f

or

add

itio

na

l ash d

am

re

qu

irem

ents

.



4 Stakeholder Analysis This section briefly addresses stakeholder profiling, stakeholder engagement protocols, and

stakeholder issues. The objectives of including these aspects are discussed in the sub-sections ahead.

Stakeholder Profiling

During the stakeholder identification exercise, a stakeholder analysis matrix was developed to

determine:

The extent to which the project will impact stakeholders, and/or the extent to which stakeholders

have an interest in the project;

The degree of influence that stakeholders might have over the progress (and even success) of the

project; and,

The nature of the engagement required, based on the impact/influence and impact scales of

stakeholders, i.e. consult, collaborate, inform.

As illustrated in Figure 4-1, engagement with stakeholders should intensify as impact/interest and

influence increase. The following criteria were used to place stakeholders within the matrix:

Zone of influence: Physical location relative to the project site and potential impacts. Generally,

the closer stakeholders live to a project site the higher their interest and the potential impacts of

the project;

Stakeholder values: The value stakeholders attach to the area that might be affected by the

intervention. This includes aspects such as livelihoods, resilience, land use, ownership, heritage

and sense of place; and,

Jurisdiction: The mandate/influence of institutions over regulatory and public opinion, with

attention to the area within the ZoI.

Figure 4-1: Stakeholder analysis matrix

According to Figure 4-1, depending on the stakeholder interest in the project and the level of impact

by the project, several engagement protocols should be considered as follows (Table 4-1):

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

40

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Tab

le 4

-1:

Sta

keh

old

er

en

gag

em

en

t p

roto

co

l

Typ

e o

f sta

ke

ho

lde

r

Le

ve

l o

f en

gag

em

en

t

En

gag

em

en

t G

oal (s

) C

om

mu

nic

ati

on

N

atu

re o

f re

lati

on

sh

ip

Bysta

nd

er

Lo

w

inte

rest/

low

im

pa

ct

an

d

low

degre

e o

f in

flue

nce

Info

rm

Info

rm

or

educate

sta

keho

lders

O

ne-w

ay c

om

munic

ation fro

m the c

om

pan

y to

the s

takehold

er,

there

is n

o invitation t

o r

eply

or

pla

tform

to e

nga

ge f

rom

sta

keho

lder.

Short

-term

re

lationship

w

ith

sta

keh

old

ers

, usua

lly f

or

the d

ura

tion o

f th

e p

roje

ct.

Infl

uen

cer

Lo

w in

tere

st/ lo

w im

pact

an

d

hig

h d

egre

e o

f in

flu

ence

Fo

llo

wer

Hig

h i

nte

rest/ h

igh i

mpact

an

d

low

d

egre

e

of

influe

nce

- C

onsult a

nd c

olla

bora

te

Consult

Gain

in

form

ation

an

d

feedb

ack

from

sta

kehold

ers

to

in

form

de

cis

ions

ma

de

in

tern

ally

Lim

ite

d tw

o-w

ay c

om

mu

nic

ation: E

skom

asks

questions a

nd t

he s

takeh

old

ers

answ

er.

Lon

g-t

erm

in

volv

em

ent.

The

com

pan

y

com

mits

to

ongo

ing

in

form

atio

n

dis

sem

ination,

captu

ring an

d re

sp

on

din

g to

sta

keho

lder

issues a

nd c

oncern

s, in

corp

ora

te

sta

keho

lder

inputs

in

to

decis

ion-m

akin

g

pro

cess,

and p

rovid

e f

eed

back o

n d

ecis

ions

taken.

Colla

bora

te

Part

ner

with

or

conve

ne

a

netw

ork

of

sta

keh

old

ers

to

deve

lop

mutu

ally

a

gre

ed

solu

tions

and

jo

int

pla

n

of

action

Tw

o-w

ay,

or

multi-

wa

y b

etw

een c

om

pan

y/ie

s

and s

takeho

lders

. Learn

ing,

neg

otiation,

an

d

decis

ion m

akin

g o

n b

oth

sid

es.

Sta

kehold

ers

w

ork

to

geth

er

and in

flu

ence each oth

er

for

join

t action a

nd

resolu

tion o

f is

sues.

Lon

g-

term

in

volv

em

ent, w

ith th

e com

pa

ny

seekin

g d

irect

inp

ut, a

dvic

e a

nd p

art

icip

atio

n

of

a sta

ke

ho

lder.

R

eg

ard

sta

keh

old

er

as a

part

ner

and a

dvis

or.

Sh

ap

er

Hig

h i

nte

rest/ h

igh i

mpact

an

d

hig

h d

egre

e o

f in

flu

ence

Colla

bora

te

Part

ner

with

or

conve

ne

a

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Key stakeholders identified in the key informant interviews include:

Government (National, Provincial, District and Local);

Host communities;

Competent and commenting authorities;

Neighbouring mines/businesses (e.g. Transnet);

Non-Governmental Organisations (NGOs);

Business forums;

Transportation forums (e.g. trucking companies);

Internal stakeholders; and,

Neighbouring farmers.

The high-level stakeholder analysis illustrated in Figure 4-2 indicates similar stakeholder relationships

and patterns amongst the four power stations. However, some differentiators have been identified and

are highlighted here. It was noted that Camden has less interaction with influencers (specifically

NGO’s), when compared to the other three power stations. In addition, the shapers in all four power

stations are made up largely by governmental structures, many of whom play a compliance role.

Stakeholder forums were identified across all four power stations’, ZoI, with forums representative of

adjacent farmers, municipalities and receiving communities.

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Stakeholder Issues

Current issues identified by external stakeholders were discussed with the internal power station

stakeholders. The purpose of identifying these risks was to inform the selection of the relevant

options based on existing issues and how the power stations currently manage them. SRK did not

receive any grievances or comments and response reports from the power stations. As a result, the

stakeholder issues stated in the report are as provided verbally by the internal and power station

stakeholders.

These issues were considered in the impact assessment and options analysis. Most of the issues

mentioned related to environmental impacts such as water and air contamination, as well as

employment and procurement opportunities at the power stations. With the power stations sourcing

most of their labour from their immediate host communities, there are still dissatisfactions by these

communities that contractors do not employ locally, especially during scheduled power outages.

Figure 4-3 provides a list of stakeholder issues per power station. The number 0 means that a

particular issue has not been mentioned at a power station; while a 1 means that, a particular issue

was mentioned.

According to this diagram, the following issues were commonly identified across all the four power

stations:

Host communities not being able to differentiate between power station impacts and impacts

from other industries;

Groundwater pollution;

Air pollution (emission related); and,

Air pollution (dust related).

Three out of four power stations identified water pollution as a stakeholder issue. These issues

should form the basis for engaging with communities and surrounding stakeholders at the power

stations should any of the options under investigation be implemented.



Figure 4-3: Stakeholder issues per power station



5 Impact Assessment and Options Analysis Following the completion of the compilation of the macro-economic and socio-economic baseline,

the review of strategies and plans, and the stakeholder analysis, SRK completed the identification

and assessment of the potential changes and impacts of each of the three options for each power

station.

The Pugh Matrix Method, a quantitative, multi-dimensional decision analysis technique, is used to

compare the three options against the current baseline in order to identify a preferred option. To do

this, a basic decision matrix was developed, consisting of a set of weighted criteria to rate the

potential options against. Seven criteria were identified and further expanded, ending with 19 sub-

criteria.

The performance of each option for each power station was rated against these sub-criteria on a

scale from 1 to 5, as per Table 5-1.The rating was multiplied by the weighting, to give an overall

score. The weighting was done on a scale from 1 to 3, where a category with a weighting of 3 is

more important than a category with a weighting of 1. The maximum score that can be reached is

15, and the minimum score is 1 as per Table 5-2. The higher the final score of sub-criteria, the

better/more ideal the change/impact of the option in regards to the sub-criteria under assessment.

Table 5-1: Rating definitions

Rating Definition

1 The power station will be responsible for significant and sustained negative impact/change

2 The power station will be responsible for a small negative impact/change

3 The power station will be responsible for limited positive or negative socio-economic impacts/changes

4 The powers station will be responsible for positive (possibly intermittent) socio-economic impacts/changes

5 The power station will be a significant contributor to the socio-economic environment

Table 5-2: Weighting multiplied by rating scores

We

igh

tin

g 3 3 6 9 12 15

2 2 4 6 8 10

1 1 2 3 4 5

1 2 3 4 5

Rating



As mentioned, the final score of each sub-category was completed by multiplying the weighting by

the rating. The final rating score was placed into three categories, as per Table 5-3.

Table 5-3: Final score definition

Score Definition

1-5

Poor -The outcome will result in overall negative socio-economic changes/impacts. Increased grievances and community/stakeholder dissatisfactions, and stakeholder instability, could occur.

6-10 Medium - The outcome will result in manageable socio-economic changes/impacts. Some grievances may still occur.

11-15 Good -The outcome will have potentially positive socio-economic results.

As mentioned, seven impact categories with 19 impact sub-categories in total were identified to

assess the options against. These are:

Employment and Procurement Impacts

o Direct employment – current and expected total number of permanent employees and

contractors; and,

o Procurement – current and expected services provided to the power stations such as

trucking, catering, maintenance, etc.

Environmental Impacts

o Air emissions – current and expected reported grievances related to stack emissions

based;

o Fugitive dust – current and expected reported grievances related to dust emanating from

the ash dams and stockpiles;

o Surface water pollution – current and expected reported grievances related to

contamination of surrounding water sources;

o Ground water pollution – current and expected reported grievances related to

contamination of groundwater due to seepage; and,

o Water usage – current and expected water requirements for the power station.

CSI and Training Impacts

o CSI contribution – current and expected contribution of the Eskom Foundation to the socio-

economic development of the area; and,

o Education and training – current and expected training and upskilling of employees per site.

Service Delivery Impacts

o Water – current and expected provision of potable water to local communities and

municipalities;

o Electricity – current and expected provision of electricity to local communities and the

municipalities;

o Sanitation – current and expected provision of water treatment works to the municipality

and maintenance of infrastructure; and,

o Waste removal – current and expected provision of waste removal services and land fill

sites.



Coal Sourcing Impacts

o Trucking – current and expected transportation of coal from source to stockpiles (negative

impacts related to safety, environment, damage to roads and nuisance impacts).

Land Take Impacts

o Current and expected environmental impacts linked to the potential loss of biodiversity and

wetland health; and,

o Current and expected socio-economic impacts linked to potential economic and/ physical

displacement.

Regional and National Economic Contribution Impacts

o Power supply – current and expected capacity available to the national power grid;

o GDP contribution – current and expected contribution to the GDP; and,

o Local and regional economic multipliers – current and expected cumulative contribution to

the local economy.

The options analysis against these criteria is summarised in this section, and the details are

documented in Appendix E. These options, as discussed in section 1 of this report, are listed again

below:

Option 1: Lifex and Modernisation (Refurbishment);

Option 2 : Repower with Biomass or Gas;

Option 3: Rebuild as PF or CFBC (Demolish and rebuild); and,

Option 4: Do not renew (Decommission).

Hendrina Power Station

Hendrina power station is analysed against the assessment criteria in the table below, as illustrated

in Figure 5-1.



Table 5-4: Hendrina power station options analysis

Socio-economicCriteria

Hendrina Overall Assessment

Employment andProcurement

Options 1 and 3 will result in a medium to high positive impact. Hendrina power station currently employs a total of 690 employees, 670 of which reside in Pullenshope, which is ± 4km away from the power station. Pullenshope is a settlement that came into existence to house Eskom employees. No labour will be lost for Options 1 and 3, and continuous employment will be maintained for an additional 50 years. However, both Options 1 and 3 will not require permanent employees during the refurbishment and rebuilding process. The impact on employees will be higher for Option 3 (Fleet Renewal Assumptions, 2016).

Additionally, Hendrina provides procurement opportunities for coal trucking and several other businesses such as coal sourcing, construction and engineering, catering, accommodation, cleaning services etc., which in turn provide spin-off employment opportunities to the local and regional communities. Sourcing of components for the refurbishment and rebuild (Options 1 and 3) could potentially lead to additional jobs, although for a short period.

Implementing Option 4 at Hendrina power station will lead to loss of employment for the community of Pullenshope (670), which, with a household size of 3.3 in Steve Tshwete Local Municipality, could potentially affect over 2000 dependents of these employees. This also has a potential to result in dissatisfactions in the surrounding communities, loss of businesses, especially coal trucking, transportation and other services, as well as loss of income to the local GDP from employee taxes. However, on a regional and national scale, this impact is moderate, especially if the decommissioned stations will be replaced elsewhere, and more job opportunities will be created for the benefit of the country.


Options 1 and 3 will result in a continuation in environmental impacts, particularly fugitive dust with a rating of 2 and surface water pollution with a rating of 4, if not properly managed. Due to the continuation of wet cooling for Option 1, a lot more water will be used as compared to Option 3, which will use a dry cooling system, resulting in water shortages and/or restrictions for other users. On the other hand, groundwater and surface water pollution from operations of the power station will further limit the amount of potable water available for domestic use. Because Hendrina power station supplies potable water to the Pullenshope community and Hendrina, demand for additional water at the power station might affect these communities, especially during drought periods and water restrictions.

Option 4 will result in a medium rating for air emissions, while water usage for the operation will reduce significantly, and can be freed up for continued allocation to other water users.

LED and CSI Options 1 and 3 will allow Eskom Foundation to continue with these initiatives, as well as the allocation to each power station with a CSI fund. However, should Option 4 be implemented, it is possible for all these initiatives to cease, thus leading to increased levels of vulnerability for the organisations and individuals currently supported by these activities.

ServiceDelivery

Hendrina power station supplies potable water, electricity and waste removal services to Pullenshope and Woestalleen mines. Water and electricity are supplied to the municipality who then provide it to the community. The power station assists with waste removal and utilises their landfill site. Sewerage is treated at the Eskom treatment plant.

Options 1 and 3 have the potential to maintain or increase the provision of services to the surrounding communities and the municipality, resulting in a positive socio-economic impact to the area.

Option 4 on the other hand, might lead to the services currently enjoyed by the community being transferred to the municipality, thus potentially limiting access of these services for the community.

Coal Sourcing Hendrina power station sources its coal from the surrounding mines of Optimum and Woestalleen. Some coal is also trucked in to ensure necessary stockpile levels are maintained. On the other hand, the negative environmental impacts of trucking coal into the power station i.e. damage to roads, grievances by local farmers and communities could potentially decrease should Option 4 be implemented.

Land Take Option 1 will require additional land for the storage of ash, gypsum and limestone. Eskom does not have land available within the current footprint, and land will have to be acquired from external stakeholders.

Option 3 will also require access to additional land for rebuilding, thus triggering the environmental and socio-economic impacts on land that is not on the existing footprint of the power station. Impacts of land take could result in economic and/or physical displacement, which could potentially lead to further impacts such as community




Hendrina Overall Assessment

grievances, deterioration of relationships between the power station and communities, disturbance/ loss of existing livelihoods and vulnerability of those affected.

Option 4 will not require additional land and is therefore the most preferred option from this sub-category’s point of view.

Local and Regional Economic Multipliers

Options 1 and 3 will allow for Hendrina power station to continue contributing to the national and regional power supply in the area, thus maintaining the status quo.

With Option 4, it is possible that Hendrina will no longer contribute towards the national grid thus reducing capacity and access. Contribution to the economy will also decline significantly. Other service providers that are reliant on the power station for business might also get out of business, further compounding the issue of unemployment and poverty in the region. Although there may be a proliferation of services related to decommissioning, it will be on a small scale compared to opportunities afforded by Options 1 and 3.

Recommended option based on social situation analysis:

Options 1 and 3 are the preferred options in that their implementation will lead to continued maintenance of current employment, as well as creating new employment opportunities into the future. Furthermore, the CSI spend through the Eskom Foundation will also continue, thus providing the beneficiaries with skills to increase their employability, as well as access to other livelihoods opportunities such as small businesses.

However, from an environmental point of view, these two options differ in that Option 1 will continue to use more water due to its wet cooling system while Option 3 will be using a dry cooling system. Both

options however reduce the emissions of CO2, sulphur dioxide (SOx), and nitrogen dioxide (NOx

due to the installation of FGD.

In terms of the relationship between the power station and the communities, these Options 1 and 3 are less likely to result in community dissatisfactions that would normally occur during job losses associated with decommissioning.

From a land take point of view, Option 1 is the most preferred option in that it will not require additional land, whereas Option 3 will require additional land for ash, limestone and gypsum.

Due to the marginal difference between Option 1 and Option 3, and the fact that both score differently for each of the criteria, it is important that other studies, i.e. financial, engineering and technical are considered in making a decision to choose either of the two.

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Arnot Power Station

Arnot power station is analysed against the assessment criteria in the table below, as illustrated in

Figure 5-2.

Table 5-5: Arnot power station options analysis


Arnot Overall Assessment


Arnot power station currently employs a total of 710 employees, 94.0% (666) residing in Rietkuil. Arnot power station also provides procurement opportunities for coal trucking and several other businesses, which in turn provide employment to about 300 people. No labour will be lost for Options 1 and 3, and continuous employment will be maintained for an additional 50 years. Coal was previously supplied to Arnot from Exxaro (this mine has now closed). Arnot power station now trucks in all of their coal requirements (sourced from Glencore and Goedehoop mines). However, both Options 1 and 3 will not require permanent employees during the refurbishment and rebuilding process. The impact on employees will be higher for Option 3 (Fleet Renewal Assumptions, 2016).

Options 1 and 3 will result in a medium to good positive impact to the local communities, current employees and business service providers of the power station such as coal sourcing, construction and engineering, catering, accommodation, cleaning services etc, which in turn provide additional jobs regionally and locally. During the construction phase of the units being refurbished or rebuilding the power station (Options 1 and 3), it is possible that procurement could increase, thus leading to more people being employed although for a shorter period of time.

Implementing Option 4 at Arnot power station could lead to job losses for current employees in the community of Rietkuil and surroundings (666), which, with a household size of 3.3 in Steve Tshwete Local Municipality, could potentially affect over 2 000 dependents of these employees. Job losses could potentially result in dissatisfactions in the surrounding communities, loss of businesses, especially coal trucking, transportation and other services, as well as loss of income to the local GDP from employee taxes. However, on a regional scale, this impact is moderate, especially if the decommissioned stations will be replaced elsewhere, and more job opportunities will be created for the benefit of the country.


Options 1 and 3 may result in continuation in environmental impacts, particularly fugitive dust and surface water pollution, which have ratings of 3 and 4 respectively and could both lead to continued negative impact to the surrounding community, if not managed.

Water usage for Option 1 will be higher as it will be continuing with the wet cooling systems, whereas Option 3 will be using dry cooling for the installation of FGD technologies that will enable Eskom to meet new emissions requirements. As a result, Option 1 will potentially result in water shortages and/or restrictions for other users especially in the wake of climate change and resultant impacts.

Option 4 will result in a medium rating for air emissions and fugitive dust, while water usage for the operation will reduce significantly, and can be freed up for continued allocation to other water users. There will however, still be residual groundwater and air quality impacts from the existing waste facilities.

LED and CSI Options 1 and 3 will allow the Eskom Foundation to continue with these initiatives, as well as the allocation to each power station with a CSI fund. However, should Option 4 be implemented, it is possible for all these initiatives to cease, thus leading to increased levels of vulnerability for the organisations and individuals currently supported by these activities.

ServiceDelivery

Arnot power station supplies potable water, and electricity to Rietkuil and Arnot mines at heavily subsidised rates. Other services such as waste removal are managed by the municipality. All upkeep and maintenance are also well managed by the municipality.

Options 1 and 3 have the potential to maintain or increase the provision of services to the Rietkuil and Arnot mine, resulting in a positive socio-economic impact to the area.

Option 4 on the other hand, might lead to the services currently enjoyed by the community being transferred to the municipality, potentially limiting access of these services for the community should there be capacity constraints at the municipality.

Coal Sourcing Arnot power station sources its coal from Goedehoop mine. Some coal is also trucked in to ensure necessary stockpile levels are maintained. On the other hand, the negative environmental impacts of trucking coal into the power station i.e. damage to roads,




Arnot Overall Assessment

grievances by local farmers and communities, social ills associated with trucking such as prostitution could potentially decrease should Option 4 be implemented.

Land Take Option 1 will require additional land for the storage of ash, gypsum and limestone. Eskom does not have land available within the current footprint, and land will have to be acquired from external stakeholders.

Option 3 will require access to additional land for rebuilding, thus triggering the environmental and socio-economic impacts on land that is not on the existing footprint of the power station. Impacts of land take could result in economic and/or physical displacement, which could potentially lead to further impacts such as community grievances, disturbance of relationships between the power station and communities, disturbance/loss of existing livelihoods and vulnerability of those affected.



Options 1 and 3 will allow for Arnot power station to continue contributing to the national and regional power supply in the area, thus maintaining the status quo. With Option 4, it is possible that Arnot power station will no longer contribute towards the national grid thus reducing capacity and access. Contribution to the economy will also decline significantly. Other service providers that are reliant on the continued operation of the power station for business might also get out of business, further compounding the issue of unemployment and poverty in the region. Although there may be a proliferation of services related to decommissioning, it will be on a small scale compared to opportunities afforded by Options 1 and 3.


Options 1 and 3 are the preferred options in that their implementation will lead to continued maintenance of current employment levels, as well as creating new employment opportunities into the future. Furthermore, the CSI spend through the Eskom Foundation will also continue, thus providing the beneficiaries with skills to increase their employability, as well as access to other livelihoods opportunities such as small businesses.


options however reduce the emissions of CO2, SOx, and NOx, due to the installation of FGD.

In terms of the relationship between the power station and the communities, Options 1 and 3 are less likely to result in community dissatisfactions that would normally occur during job losses associated with decommissioning.



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Komati Power Station

Komati power station is analysed against the assessment criteria in the table below, as illustrated

in Figure 5-3.

Table 5-6: Komati power station options analysis


Komati Overall Assessment


Options 1 and 3 will result in a medium to good positive impact on the local communities, current employees and business service providers of the power station. Komati power station currently employs a total of 470 employees, 439 (93.0%) of which reside in Emalahleni. However, both Options 1 and 3 will not require

permanent employees during the refurbishment and rebuilding process. The impact on employees will be similar for both options (Fleet Renewal Assumptions, 2016).

Additionally, Komati provides procurement opportunities for coal trucking and several other businesses such as coal sourcing, construction and engineering, catering, accommodation, cleaning services etc, which in turn provide further employment opportunities locally and regionally. No labour will be lost for Option 1 and 3, and continuous employment will be maintained for an additional 50 years. During the construction phase of the units being refurbished or the rebuilding of the power station (Options 1 and 3), it is possible that procurement could increase, thus leading to more people being employed although for a shorter period of time.

Implementing Option 4 at Komati power station could lead to job losses for the communities within the ZoI. Currently Komati employs a total of 439 people from the local areas, which, with a household size of 3.3 in Steve Tshwete Local Municipality, could potentially affect over 1 500 dependents of these employees. Job losses could potentially result in dissatisfactions in the surrounding communities, loss of businesses, especially coal trucking, transportation and other services, as well as loss of income to the local GDP from employee taxes.

However, on a regional scale, this impact is moderate, especially if the decommissioned stations will be replaced elsewhere, and more job opportunities will be created for the benefit of the country.


Options 1 and 3 will result in continuation in environmental impacts, particularly air emissions and groundwater pollution with a rating of six and a medium impact to the surrounding communities, if not properly managed. Although FGD will be installed to abate emissions, this installation will require a lot more water since the wet cooling system will continue. This will potentially result in water shortages and/or restrictions for other users. Surface water pollution and fugitive dust remain high, with grievances received from local farmers who also claimed that the power station was responsible for fluoride pollution in the water, which was killing cattle.

Option 4 will result in a medium rating for air emissions and fugitive dust, while water usage for the operation will reduce significantly, and can be freed up for continued allocation to other water users.

LED and CSI Options 1 and 3 will allow Eskom Foundation to continue with these initiatives, as well as the allocation to each power station with a CSI fund.

However, should Option 4 be implemented, it is possible for all these initiatives to cease, thus leading to increased levels of vulnerability for the organisations and individuals currently supported by these activities.

ServiceDelivery

Komati power station supplies potable water, and electricity to Komati at heavily subsidised rates. Other services such as waste removal are managed by the municipality. All upkeep and maintenance are also well managed by the municipality.

Options 1 and 3 have the potential to maintain or increase the provision of services to the Komati Village and the municipality, resulting in a positive socio-economic impact to the area.

Option 4 on the other hand, might lead to the services currently enjoyed by the community being transferred to the municipality, thus potentially limiting access of these services for the community due to possible capacity constraints at the municipality.




Komati Overall Assessment

Coal Sourcing Komati power station sources its coal from the Koornfontein mine (Optimum) and surplus trucked in. Some coal is also trucked in to ensure necessary stockpile levels are maintained. On the other hand, the negative environmental impacts of trucking coal into the power station i.e. damage to roads, grievances by local farmers and communities, social ills associated with trucking such as prostitution could potentially decrease should Option 4 be implemented.

Land Take Option 1 will require additional land for the storage of ash, gypsum and lime. Eskom does not have land available within the current footprint, and land will have to be acquired from external stakeholders.

Option 3 might also require access to additional land for rebuilding, thus triggering the environmental and socio-economic impacts on land that is not on the existing footprint of the power station. Impacts of land take could result in economic and/or physical displacement, which could potentially lead to further impacts such as community grievances, disturbance of relationships between the power station and communities, disturbance/ loss of existing livelihoods and vulnerability of those affected.

Option 4 will not require additional land and is therefore the most preferred option from this point of view.


Options 1 and 3 will allow for Komati power station to continue contributing to the national and regional power supply in the area, thus maintaining the status quo. With Option 4, it is possible that Komati will no longer contribute towards the national grid thus reducing capacity and access. Contribution to the local economy in terms of payments of rates and taxes to the municipality will also decline significantly. Other service providers that are reliant on the power station for business might also get out of business, further compounding the issue of unemployment and poverty in the region. Although there may be a proliferation of services related to decommissioning, it will be on a small scale compared to opportunities afforded by Options 1 and 3.




options however reduce the emissions of CO2, SOx, and NOx due to the installation of FGD.




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Camden Power Station

Camden power station is analysed against the assessment criteria in the table below, as illustrated

in Figure 5-4.

Table 5-7: Camden power station options analysis


Camden Overall Assessment


Options 1 and 3 will result in a medium to high positive impact. Camden power station currently employs a total of 373 employees, 363 of them coming from within Mpumalanga Province. Although 351 of employees reside in Ermelo, it is not clear if all of them are permanent residents or if they have migrated to the area to seek employment. No labour will be lost for Options 1 and 3, and continuous employment will be maintained for an additional 50 years. However, both Options 1 and 3 will not require permanent employees during the refurbishment and rebuilding process. The impact on employees will be similar for both options (Fleet Renewal Assumptions, 2016).

With the life span increasing to 70 years, the employment created and procurement opportunities will be prolonged. Additionally, Camden provides procurement opportunities for coal trucking and several other businesses, which in turn provide employment to about 300 people. During the construction phase of the units being refurbished or the power station being rebuilt (Options 1 and 3), it is possible that procurement could increase, thus leading to more people being employed although for a shorter period of time.

Option 4 will result in a significant loss of employment for the current employees of Camden, which will potentially result in dissatisfactions in the surrounding communities, loss of businesses, especially coal trucking, transportation and other services, as well as loss of income to the local GDP from employee taxes.

However, on a regional and national scale, this impact is moderate, especially if the decommissioned stations will be replaced elsewhere, and more job opportunities will be created for the benefit of the country.


Options 1 and 3 will result in continuation in environmental impacts, which will be more than the status quo. Fugitive dust and surface water pollution will be the same for all the three options. However, surface water pollution for all the options remains a big environmental issue, with a rating of 3 out of 15.

Option 1 will use a lot more water than the other 2 options, which might result in water shortages and/ or restrictions for other users.

With Option 4, environmental impacts of air emissions, fugitive dust will decrease, whereas water usage for the operation will reduce significantly, and can be freed up for other users in the region such as mining, farming and domestic use.

LED and CSI Options 1 and 3 will allow Eskom Foundation to continue with these initiatives, as well as the allocation to each power station with a CSI fund. However, should Option 4 be implemented, it is possible for all these initiatives to cease, thus leading to increased levels of vulnerability for the organisations and individuals currently supported by these activities.

ServiceDelivery

Camden power station supplies water to the Vunene Mine and to Camden Village Army Base, with the Department of Public Works paying for this service for the Army Base. Water from Camden is not supplied to the Municipality and the community. Not all other services are provided by Camden. As a result, none of the options will have a negative impact to the community and Municipality, thus maintaining the existing status quo. On the other hand, should the life of the power station be extended due to Options 1 and 3, there is a possibility of the power station staring to provide these services to the municipality, or contributing.

Coal Sourcing Coal from Camden is sourced from Vunene Mine, ± 12km from Camden. In total, road trucks- meaning coal trucks moving coal from Vunene to Camden (12km distance) are 200 to 300 per day, while trucks offloading the train internally at Camden (no public road) are 300 to 400 per day. This in total processes about 700 trucks per day.

On the other hand, the negative environmental impacts of trucking coal into the power station i.e. damage to roads, grievances by local farmers and communities could potentially decrease should Option 4 be implemented.

Land Take Option 1 will require additional land for the storage of ash, gypsum and lime. Eskom does not have land available within the current footprint, and land will have to be acquired from external stakeholders.




Camden Overall Assessment

Option 3 might also require access to additional land for rebuilding, thus triggering the environmental and socio-economic impacts on land that is not on the existing footprint of the power station. Impacts of land takes could result in economic and/or physical displacement, which could potentially lead to further impacts such as community grievances, disturbance of relationships between the power station and communities, disturbance/loss of existing livelihoods and vulnerability of those affected.



Options 1 and 3 will allow for Camden power station to continue contributing to the national and regional power supply in the area, thus maintaining the status quo. With Option 4, it is possible that Camden will no longer contribute towards the national grid thus reducing capacity and access. Contribution to the local economy in terms of payments of rates and taxes to the Municipality will also decline significantly. Other service providers that are existent due to the power station might also get out of business, further compounding the issue of unemployment and poverty in the region. Although there may be a proliferation of services related to decommissioning, it will be on a small scale compared to opportunities afforded by Options 1 and 3.




options however reduce the emissions of CO2, SOx, and NOx, due to the installation of FGD.




SR

K C

on

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ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

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m F

lee

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en

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al

Pa

ge

59

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Fig

ure

5-4

: C

am

den

po

wer

sta

tio

n o

pti

on

s a

naly

sis



Rapid Vulnerability/Self-sustenance Assessment of Local ZoI

Due to the pre-feasibility level of this study, as well as the socio-economic and situational similarities

between the power stations, determining vulnerability and communities’ resilience to the changes

brought about by each option for each of the power stations will be discussed here.

In summary, the communities adjacent to all the power stations have adaptive capacities ranging

from low to moderate. As such, for Options 1 and 3 communities vulnerability would ultimately be

lower. However, Option 4 will increase the vulnerability of the communities, especially due to the

lack of skills, high dependency rates, etc. The common patterns that might develop would be the

outmigration of the retrenched employees to the new build power stations in Limpopo Province or

to Gauteng Province, or elsewhere in search of employment.

For the purpose of this report, the following definitions apply to this assessment:

Community: Social system interactions encompassed within a definite geographic space;

Vulnerability: State of susceptibility to harm, powerlessness, and marginality of both physical

and social systems; and,

Adaptive capacity: Ability of a social system to respond/recover and/or absorb impacts12.

The vulnerability assessment is not reflected as an assessment criterion, since it will result in a

double count of aspects contained in the assessment criteria identified. Based on the information in

this report (506503/F1) the following existing stresses to the system have been noted:

Existing stresses to the system

Dependency on power stations for service delivery;

Significant levels of poverty, particularly in communities surrounding Camden;

Poor housing infrastructure: a large percentage of the communities living in informal settlements

including Kwazamakuhle;

High local unemployment;

Low skills level; and,

“one sector economy”: i.e. reliance on coal supply and energy generation.

Following careful consideration of the above existing socio-economic stresses and projected

changes, as well as narrative supplied in the socio-economic baseline, each power station’s

vulnerability and adaptive capacity is dealt with in the sub sections to follow.

5.5.1 Hendrina Power Station

Hendrina is an important local employer and the second biggest employer of the three power

stations after Arnot, directly employing 670 people from Pullenshope alone. Should the power

station be decommissioned, a large percentage of the Pullenshope community will be without a job,

many of whom are breadwinners for large households. This, along with a dependency on the power

station for the delivery of potable water, electricity and sanitation leave the Pullenshope community

highly vulnerable to change, specifically decommissioning. Pullenshope has grown around the

Hendrina power station, although it is also home to a number of people employed in other economic

activities, including mining and logistics. It can thus be assumed that the adaptive capacity of the

Pullenshope community can be deemed low to moderate, however, the broader receiving

12

Definitions sourced at: Colburn, L. (2011). Resilience, vulnerability, adaptive capacity and social capital.



community for the Hendrina power station, which includes Hendrina town, is considered to comprise

a slightly more diversified economy, and as such, moderate to fair adaptive capacity is to be

assumed.

Important to note is the growth and existence of informal settlements in the greater receiving area

of the Hendrina power station, specifically the Kwazamakuhle township. Limited socio-economic

conditions, legacies of segregated South Africa, and ongoing reliance on parastatals and non-

governmental entities for the maintenance and formalisation thereof continue to hinder the

stabilisation of informal settlements in the receiving communities, which reduce the overall adaptive

capacity of the Hendrina power station’s receiving community. As with Arnot, Hendrina’s receiving

communities stands to lose larger socio-economic standpoints, specifically from an employment

and service delivery perspective. Options 1 and 3 would suggest the least impact in a socio-

economic vulnerability sense when compared to Option 4, however, greater thought and action

would increase adaptive capacity in terms of dependency on a “single” economy and non-diversified

economic activities.

5.5.2 Arnot Power Station

The towns of Arnot and Rietkuil were initially developed to accommodate employees at the Arnot

power station, later growing to accommodate employees on the surrounding mines as well. As such,

both towns are still reliant on the power station for direct and indirect employment, as well as service

delivery. Arnot provides sanitation, potable water and electricity to both Rietkuil and Arnot Villages,

as well as maintenance of parks and sidewalks in Rietkuil. As a result, the communities have come

to rely heavily on the power station for socio-economic opportunities and services. This has resulted

in a significant dependency on the power station, which renders the communities vulnerable to

changes at the operation, should they occur.

Coupled with this, existing socio-economic conditions (high unemployment and poverty levels, low

skills levels and poor housing and health care facilities) highlight the communities’ low adaptive

capacity and ability to absorb changes.

Therefore, the communities’ adaptive capacity can be considered low to moderate13. Should Options

1 or 3 be chosen, it will be far easier for the communities to adapt to changes as in both options,

the power station will continue to operate and carry employment status quo and service delivery.

However, should Option 4 go ahead, communities stand to lose 710 direct jobs and 600 plus indirect

employment and procurement opportunities.

5.5.3 Komati Power Station

Komati power station, although not as large as Arnot and Hendrina, is still a significant socio-

economic contributor to the regional and local economy of the receiving community, specifically in

terms of employment. Currently, the Komati power station provides 470 direct jobs. As experienced

in receiving communities for both Arnot and Hendrina, Komati power station provides electricity,

sanitation and potable water for receiving communities (including to the informal settlement of

Kwazamakuhle township).

However, on a spatial scale, Komati can be considered less significant to human settlement in terms

of local economics and social significance. While the communities of Komati and Blinkpan are the

closest receiving communities to the power station, the size of each is significantly smaller than both

Arnot and Hendrina. Furthermore, while not the sole alternative economic contributor to the local

13 Adaptive capacity deemed to be between non-resilience (low) to reasonably resilient (moderate). Capacity has been based on ability to cope relevant to current and future stresses, future impacts and access to social capital and resources.



economy; mines such as Goedehoop (located adjacent to the Komati power station) are greater

contributors to the local employment pool, when compared to the Komati power station.

When all of the above considerations, compared with other socio-economic factors are drawn into

this vulnerability assessment, like the previous two power stations, Options 1 and 3 remain the

options more likely to be preferred by receiving communities. As such, Komati power station’s

receiving community can be deemed to carry a moderate to fair adaptive capacity to Options 1 or

3, however, a change due to Option 4 could potentially see adaptive capacity slipping to low to

moderate.

5.5.4 Camden Power Station

The apparent rural status quo of Camden suggests that while the power station is an important

contributor to the regional economy, farming and other livelihood activities leave the communities’

adaptive capacity moderate to fair. While the existing socio-economics of the receiving community

are poor, the local economy is more diversified and not necessarily as reliant on the power station

as the other three power stations. Camden is the lowest employer of the three power stations (373

permanent) and, although a significant employer to the surrounding community, it is not the biggest

employer. The social baseline study indicates farm labour to be the largest employer of the local

community.

An exception to this, however, is areas where adaptive capacity of the local communities of Camden

and Sheepmoor remain highly dependent on the power station not only for service delivery (potable

water and electricity in isolated parts of the receiving community) but also for limited housing,

infrastructure and training opportunities.

The receiving area of Camden power station has the poorest existing socio-economic conditions

and municipality funding shortfalls (district and local). Although it does not have the lowest adaptive

capacity directly related to this project, it is imperative to note that Camden power station’s receiving

community continues to experience socio-economic issues over and beyond what can be directly

related to the power station. As such, should Option 4 (decommissioning) be considered, the

receiving community might be seen as highly vulnerable to any social capital and/or community

change, regardless.



6 Risk Assessment

Risk Assessment Matrix Development

A socio-economic risk assessment was completed for each option and was informed by the results

of the economic and socio-economic context as well as the results of the options analysis. These

factors informed the identification and characterisation of threats and opportunities.

A 5x5 matrix was used to identify and characterise the threats and opportunities by assessing the

consequence and probability thereof. This technique is primarily a Probability-Consequence Matrix

where each threat/opportunity is assessed against defined scales and placed on a matrix where the

calculation thereof represents the relative significance of the threat/opportunity, allowing it to be

ranked. Table 6-1 is the key to the characterisation of the threats and Table 6-2 the key to the

characterisation of the opportunities.

Table 6-1: Threat risk rating

Table 6-2: Opportunity risk rating

Risk Assessment

The risk assessment per option is reflected in Table 6-3.

Risk Rating Risk Level

21 to 25 High

13 to 20 Significant

6 to 12 Medium

1 to5 Low

A low risk exists that management’s objectives may not be achieved.

Monitor risk, no further mitigation required.

Guidelines for Risk Matrix

A high risk exists that management’s objectives may not be achieved.

Appropriate mitigation strategy to be devised immediately.

A significant risk exists that management’s objectives may not be achieved.

Appropriate mitigation strategy to be devised as soon as possible.

A moderate risk exists that management’s objectives may not be achieved.

Appropriate mitigation strategy to be devised as part of the normal management process.

Opportunity

Rating Opportunity Level

21 to 25 High

13 to 20 Significant

6 to 12 Medium

1 to5 Low

A low opportunity exists that management’s objectives may not be achieved.

Appropriate strategy to be devised immediately if linked to threat

Guidelines for Opportunity Matrix

A high opportunity exists that management’s objectives may be achieved.

Appropriate strategy and monitor opportunities/related/policies/plans

A significant opportunity exists that management’s objectives may be achieved.

Appropriate strategy to be devised as as part of the normal management process.

A moderate opportunity exists that management’s objectives may not be achieved.

Appropriate strategy to be devised as soon as possible

SR

K C

on

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ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

64

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Tab

le 6

-3:

Ris

k a

naly

sis

Th

reat/

Op

po

rtu

nit

y

Desc

rip

tio

n

Ca

use

(s)

C

on

seq

uen

ce(s

)

Co

nseq

uen

ce r

ati

ng

(1-5

) 1

is l

ow

co

nse

qu

en

ce

a5

is

hig

h c

onsequence

Pro

bab

ilit

y r

ati

ng

(1-5

) 1

is low

co

nse

qu

en

ce

a5

is h

igh

co

nseq

ue

nce

Ra

tin

g

Op

tio

n 1

: L

ifex a

nd

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Pote

ntia

l econom

ic

and

/o

r ph

ysic

al dis

pla

cem

ent

A

dditio

na

l la

nd

req

uire

ments

fo

r constr

uctio

n o

f ne

w a

sh d

am

s l

ead

ing t

o

involu

nta

ry d

ispla

cem

ent

Constr

uction

of

additio

nal

ash

dam

/s

and/o

r in

frastr

uctu

re

Could

im

pact

on o

pera

tio

n a

nd c

onstr

uctio

n t

imelin

es

Budg

et

implic

ations f

or

resettle

ment

Socia

l unre

st

Reputa

tionald

am

ag

e/r

isk

44

16

Com

mun

ity an

d em

plo

ye

e u

nre

st

and d

isru

ption

P

ote

ntia

l jo

b

loss

duri

ng

do

wntim

e

to

com

ple

te r

efu

rbis

hm

ent

Pote

ntia

l lo

ss

of

em

plo

ym

ent

duri

ng

do

wntim

e

Could

impact o

n o

pera

tion a

nd c

onstr

uctio

n tim

elin

es, as

we

ll as b

ud

get

42

8

Inade

qu

ate

com

munic

atio

n

with

sta

keho

lders

P

ote

ntia

l in

eff

ective com

mu

nic

ation w

ith

sta

keho

lders

could

le

ad

to

confu

sio

n,

unre

alis

tic e

xp

ecta

tions a

nd u

nre

st

Lack o

f cle

ar

enga

gem

ent

str

ate

gy

Loss o

f sta

keh

old

er

supp

ort

Rep

uta

tio

nal d

am

ag

e

35

15

Incre

ase

d h

ealth im

pacts

D

ue

to

incre

ased

fugitiv

e

dust

leve

ls,

hea

lth-r

ela

ted

impacts

cou

ld

pote

ntially

in

cre

ase

Continue

d

op

era

tio

ns

from

coal

as

a

sourc

e o

f en

erg

y

Incre

ase

d nu

mber

of

trucks,

specific

ally

duri

ng c

onstr

uction

Continue

d a

nd

in

cre

ased en

vironm

enta

l im

pacts

fr

om

contin

ue

d

ope

rations

an

d

from

insta

llatio

n o

f F

GD

(additio

nal

ash,

gypsum

, dis

po

sal fa

cili

ties)

respective

ly

Health im

pacts

and incre

ased

grieva

nces

24

8

Continue

d d

ep

end

ency o

n E

skom

fo

r serv

ice d

eliv

ery

C

urr

ently

Eskom

pro

vid

es

munic

ipal

serv

ices t

o local com

mu

nitie

s

Lack

of

resourc

es

within

lo

cal

munic

ipa

litie

s t

o a

ddre

ss g

row

ing s

erv

ice

re

qu

irem

ents

Rep

uta

tio

nal

dam

ag

e d

ue t

o p

erc

eiv

ed r

esp

onsib

ility

to

E

skom

for

serv

ice d

eliv

ery

Fin

ancia

l im

plic

ations

45

20

Incre

ase

d C

O2 e

mis

sio

ns

Incre

ase

d

CO

² b

y-p

roduct

due

to

ne

w

techno

log

y r

eq

uirem

ents

for

Option 1

A

ll units w

ill n

eed t

o b

e i

nsta

lled w

ith a

F

GD

to r

educe s

ulp

hur

dio

xid

e e

mis

sio

ns.

Ho

wever,

in

sta

lling

FG

D

will

in

cre

ase

re

lative

CO

2

em

issio

ns

from

th

e

po

we

r sta

tions

Exce

ed

ing

the

C

O2

em

issio

ns

cap

resultin

g

in

no

n-

com

plia

nce a

nd p

en

alis

atio

n

24

8

Op

tio

n 3

: R

eb

uil

d a

s P

F o

r C

FB

C (

Dem

oli

sh

an

d r

eb

uild

)

Pote

ntia

l econ

om

ic a

nd/o

r p

hysic

al

dis

pla

cem

ent

A

dditio

na

l la

nd

req

uire

ments

fo

r constr

uctio

n o

f ne

w a

sh d

am

s l

ead

ing t

o

involu

nta

ry d

ispla

cem

ent

Constr

uction

of

additio

nal

ash

dam

/s

and/o

r in

frastr

uctu

re

Could

im

pact

on o

pera

tio

n a

nd c

onstr

uctio

n t

imelin

es

Budg

et

implic

ations f

or

resettle

ment

Socia

l unre

st

Reputa

tionald

am

ag

e/r

isk

54

20

Com

mun

ity an

d em

plo

ye

e u

nre

st

and d

isru

ption

P

ote

ntia

l jo

b

loss

duri

ng

do

wntim

e

to

com

ple

te r

efu

rbis

hm

ent

Pote

ntia

l lo

ss

of

em

plo

ym

ent

duri

ng

do

wntim

e

Could

impact o

n o

pera

tion a

nd c

onstr

uctio

n tim

elin

es, as

we

ll as b

ud

get

43

12

Inade

qu

ate

com

munic

atio

n

with

sta

keho

lders

P

ote

ntia

l in

eff

ective com

mu

nic

ation w

ith

sta

keho

lders

could

le

ad

to

confu

sio

n,

unre

alis

tic e

xp

ecta

tions a

nd u

nre

st

Lack o

f cle

ar

enga

gem

ent

str

ate

gy

Loss o

f sta

keh

old

er

supp

ort

Rep

uta

tio

nal d

am

ag

e

35

15

Incre

ase

d h

ealth im

pacts

D

ue

to

incre

ased

fugitiv

e

dust

leve

ls,

hea

lth-r

ela

ted

impacts

cou

ld

pote

ntially

in

cre

ase

Additio

na

l ash d

am

s a

nd s

tockpile

s w

ill b

e

constr

ucte

d

Incre

ase

d nu

mber

of

trucks,

specific

ally

duri

ng c

onstr

uction

Health im

pacts

an incre

ase

d g

rievances

24

8

Incre

ased C

O²

em

issio

ns

Incre

ased

CO

2

by-p

rod

uct

due

to

ne

w

techno

log

y r

eq

uirem

ents

for

Option 3

A

ll units w

ill n

eed t

o b

e i

nsta

lled w

ith a

F

GD

to r

educe s

ulp

hur

dio

xid

e e

mis

sio

ns.

Ho

wever,

in

sta

lling

FG

D

will

in

cre

ase

re

lative

CO

2

em

issio

ns

from

th

e

po

we

r sta

tions

Exce

ed

ing

the

C

O2

em

issio

ns

cap

resultin

g

in

no

n-

com

plia

nce a

nd p

en

alis

atio

n

24

8

Continue

d d

ep

end

ency o

n E

skom

fo

r serv

ice d

eliv

ery

C

urr

ently

Eskom

pro

vid

es

munic

ipal

serv

ices t

o local com

mu

nitie

s

Lack

of

resourc

es

within

lo

cal

munic

ipa

litie

s t

o a

ddre

ss g

row

ing s

erv

ice

re

qu

irem

ents

Rep

uta

tio

nal

dam

ag

e d

ue t

o p

erc

eiv

ed r

esp

onsib

ility

to

E

skom

for

serv

ice d

eliv

ery

Fin

ancia

l im

plic

ations

45

20

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

65

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Th

reat/

Op

po

rtu

nit

y

Desc

rip

tio

n

Ca

use

(s)

C

on

seq

uen

ce(s

)

Co

nseq

uen

ce r

ati

ng

(1-5

) 1

is l

ow

co

nse

qu

en

ce

a5

is

hig

h c

onsequence

Pro

bab

ilit

y r

ati

ng

(1-5

) 1

is low

co

nse

qu

en

ce

a5

is h

igh

co

nseq

ue

nce

Ra

tin

g

Op

tio

n 4

: D

o n

ot

ren

ew

(D

eco

mm

issio

nin

g)

Loss

of

dir

ect

and

indirect

em

plo

ym

ent

Due t

o t

he d

ecom

mis

sio

nin

g a

nd c

losure

of

po

wer

sta

tio

ns,

jobs w

ill n

o l

on

ger

be

availa

ble

Decom

mis

sio

nin

g o

f po

we

r sta

tions

Lack o

f socia

l clo

sure

pla

n

Rep

uta

tio

nal d

am

ag

e

Loss o

f sta

keh

old

er

supp

ort

Socia

l unre

st

Fin

ancia

l im

plic

ations

55

25

Safe

ty r

isks a

round e

xis

ting s

ites

Decom

mis

sio

ned

sites

will

re

quire

monitori

ng

and

mana

gem

ent

for

a

pro

tracte

d p

eri

od

Una

uth

orised a

ccess t

o d

ecom

mis

sio

ne

d

sites

Lack o

f socia

l clo

sure

pla

n

Opport

un

istic s

ettle

ment

Pote

ntia

l fo

r in

jurie

s o

r fa

talit

ies

Rep

uta

tio

nal d

am

ag

e

Litig

ation r

isk

Fin

ancia

l im

plic

ations

52

10

Inade

qu

ate

com

munic

atio

n

with

sta

keho

lders

P

ote

ntia

l in

eff

ective com

mu

nic

ation w

ith

sta

keho

lders

could

le

ad

to

confu

sio

n,

unre

alis

tic e

xp

ecta

tions a

nd u

nre

st

Lack o

f cle

ar

enga

gem

ent

str

ate

gy

Lack o

f socia

l clo

sure

pla

n

Loss o

f sta

keh

old

er

supp

ort

Rep

uta

tio

nal d

am

ag

e

45

20

OP

PO

RT

UN

ITIE

S

Op

tio

n 1

A/1

B:

Lif

ex a

nd

Mo

dern

isati

on

(R

efu

rbis

hm

en

t) a

nd

Op

tio

n 3

A/3

B:

Re

bu

ild

as

PF

or

CF

BC

( D

em

olis

h a

nd

re

bu

ild

)

Main

tenance

and/o

r in

cre

ase

of

curr

ent

em

plo

ym

ent

num

bers

M

ain

tain

ing

exis

ting

direct

and

ind

irect

em

plo

ym

ent

positio

ns

Refu

rbis

hm

ent

or

rebu

ild

of

exis

tin

g

po

we

r sta

tion

In

cre

ase in

con

tracto

r opport

unitie

s d

uri

ng r

efu

rbis

hm

ent

or

rebu

ild

Main

tain

curr

ent

socio

-econ

om

ic b

ase

line

34

12

Exte

nsio

n o

f lif

e o

f opera

tion

E

xte

ndin

g

the

lif

e

of

the

opera

tion

will

pro

long

em

plo

ym

ent

opp

ort

unitie

s,

CS

I spen

d

and

regio

na

l socio

-eco

nom

ic

deve

lopm

ent

Exte

nsio

n o

f th

e o

pera

tio

ns b

y 5

0 y

ears

as

a r

esult o

f re

furb

ishm

ent

or

rebuild

M

ain

tenance o

r enha

ncem

ent

of

reputa

tio

n

44

16

Develo

pm

ent

of

SM

ME

’s

Continue

d o

pe

ration w

ill a

llow

for

furt

her

deve

lopm

ent

of

local busin

esses

Exte

nsio

n o

f th

e o

pera

tio

ns b

y 5

0 y

ears

as

a r

esult o

f re

furb

ishm

ent

or

rebuild

Availa

bili

ty o

f ash f

or

brickm

akin

g

Main

tenance o

r enha

ncem

ent

of

reputa

tio

n

23

6

Op

tio

n 4

: D

o n

ot

ren

ew

(D

eco

mm

issio

nin

g)

Red

uced h

ea

lth a

nd s

afe

ty lia

bili

ty

If

pro

perl

y

man

age

d,

deco

mm

issio

nin

g

shou

ld r

esu

lt i

n d

ecre

ased a

ir e

mis

sio

ns,

dust,

wate

r conta

min

atio

n

and

oth

er

envir

onm

enta

l and

socio

-econom

ic

impacts

Decom

mis

sio

nin

g w

ith

out

dem

olis

hin

g

If p

roperl

y m

an

age

d,

impro

ve

d r

eputa

tion

Red

uced f

inan

cia

l re

sponsib

ilities

44

16

Sale

of

com

po

nents

an

d s

alv

age

D

ue to

d

ecom

mis

sio

nin

g,

pa

rts m

ay be

sold

or

re-u

sed

at

oth

er

opera

tions

Decom

mis

sio

nin

g w

ith

out

dem

olis

hin

g

Cost

savin

g

33

9

Han

din

g o

ver

of

serv

ices t

o l

oca

l m

unic

ipa

litie

s

Follo

win

g

de

com

mis

sio

nin

g,

additio

nal

serv

ices w

ou

ld be h

an

de

d o

ver

to lo

cal

munic

ipa

litie

s

Decom

mis

sio

nin

g w

ith

out

dem

olis

hin

g

Cost

savin

g

42

8



7 Conclusions and Recommendations This section summarises the conclusions and recommendations per study component, and then

proposes mitigation and enhancement measures to manage potential impacts.

Conclusions and Recommendations per Focus Area of Study

The findings of this study related to each option are provided in this section, for all the four power

stations. With the level of information available at the time of writing this report, it is important to

note that these are only indicative and should not be regarded as conclusive. Input from other

studies such as the technical and financial specialist reports is required to increase SRK’s

confidence level.

The conclusions are based on the following key components as per the scope of work and are

further discussed in Table 7-1.

Adherence to overarching national priorities and sustainable development goals;

Baseline information of the four power stations and vulnerability assessment;

Contribution to the local, regional and national economy;

Contribution to the national power grid;

Engagement with stakeholders;

Risk assessment; and,

Generation collaboration between local, regional and national contexts.

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

67

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Tab

le 7

-1:

Co

nclu

sio

ns a

nd

reco

mm

en

dati

on

s p

er

stu

dy c

om

po

nen

t

Op

tio

n

1:

Lif

ex

an

d

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Op

tio

n

3:

Reb

uild

as

PF

o

r C

FB

C

(Dem

oli

sh

an

d R

eb

uil

d)

O

pti

on

4

: D

o

no

t re

new

(D

ec

om

mis

sio

nin

g)

Ke

y F

ocu

s A

rea:

Ad

he

ren

ce t

o N

DP

s a

nd

SD

Gs

Conclu

sio

ns

Option

1

mee

ts

the

socia

l and

econ

om

ic

requ

irem

ents

of th

e N

DP

, w

hic

h furt

her

rela

te

to S

DG

s p

rovid

ed in T

able

3-3

of

this

report

. C

ontinue

d e

mplo

ym

ent

is i

n a

lignm

ent

with

S

DG

s

1

and

2.

Ho

we

ver,

fr

om

an

envir

onm

enta

l poin

t of

vie

w,

the

pote

ntial

usag

e o

f m

ore

wate

r d

ue to F

GD

insta

llatio

ns

and c

ontinue

d w

et

coo

ling s

yste

ms m

ight

be

in

conflic

t w

ith S

DG

6,

wh

ich w

ill f

urt

her

limit

access

for

oth

er

wate

r users

, especia

lly

com

munitie

s r

ely

ing

on the p

ow

er

sta

tio

ns for

wate

r sup

ply

. In

additio

n,

CO

2

em

issio

ns

associa

ted w

ith

FG

D a

re a

lso in

contr

adic

tion

to

S

DG

13,

and as a re

su

lt,

this

w

ill lik

ely

re

sult

in

po

we

r sta

tions

exceed

ing

the

allo

cate

d

em

issio

ns

cap,

an

d

takin

g

on

a

larg

er

respo

nsib

ility

for

overa

ll em

issio

ns into

th

e a

tmosph

ere

.

Continuin

g w

ith

coal a

s a

fuel f

or

these p

ow

er

sta

tions

mea

ns

that

altern

ative

energ

y

optio

ns,

wh

ich

could

pote

ntia

lly b

e c

heap

er

and m

ore

susta

ina

ble

will

not be in

vestig

ate

d,

in c

on

tra

dic

tio

n w

ith

SD

G 7

.

Option

1

mee

ts

the

socia

l and

econ

om

ic

requ

irem

ents

of th

e N

DP

, w

hic

h furt

her

rela

te

to S

DG

s p

rovid

ed in T

able

3-3

of

this

report

. C

ontinue

d e

mplo

ym

ent

is i

n a

lignm

ent

with

S

DG

s

1

and

2.

Ho

we

ver,

fr

om

an

envir

onm

enta

l poin

t of vie

w, O

ption 3

will

use

m

ore

wa

ter

than c

urr

ent

usa

ge d

ue t

o F

GD

in

sta

llatio

ns.

Ho

wever,

it

will

use l

ess w

ate

r th

an O

ptio

n 1

beca

use i

t w

ill b

e u

sin

g a

dry

coolin

g s

yste

m,

This

, ho

weve

r, w

ill s

till

be in

conflic

t w

ith S

DG

6,

whic

h w

ill fu

rther

limit

access

for

oth

er

wate

r users

, especia

lly

com

munitie

s r

ely

ing

on the p

ow

er

sta

tio

ns for

wate

r sup

ply

. In

additio

n,

CO

² em

issio

ns

associa

ted w

ith

FG

D a

re a

lso in

contr

adic

tion

to

S

DG

13 an

d,

as a re

sult,

this

w

ill lik

ely

re

sult

in

po

we

r sta

tions

exceed

ing

the

allo

cate

d

em

issio

ns

cap,

an

d

takin

g

on

a

larg

er

respo

nsib

ility

for

overa

ll em

issio

ns into

th

e a

tmosph

ere

.

Continuin

g w

ith

coal a

s a

fuel f

or

these p

ow

er

sta

tions

mea

ns

that

altern

ative

energ

y

optio

ns,

wh

ich

could

pote

ntia

lly b

e c

heap

er

and m

ore

susta

ina

ble

will

not be in

vestig

ate

d,

in c

on

tra

dic

tio

n w

ith

SD

G 7

.

Pote

ntia

l jo

b lo

sses r

ela

ted t

o t

his

option a

re

in o

ppositio

n t

o t

he S

DG

s 1

, 2,

6 a

nd 7

. A

s a

re

sult, le

ve

ls o

f povert

y a

re lik

ely

to incre

ase,

especia

lly b

ecause th

e fo

ur

po

we

r sta

tions

are

the m

ain

em

plo

yers

of

the s

urr

oun

din

g

com

munitie

s.

Com

parin

g t

his

to t

he r

egio

nal

and n

atio

nal

conte

xt, th

ese jo

b lo

sses are

le

ss

sig

nific

ant,

especia

lly

if

altern

ative

po

we

r/

repla

cem

ent

sta

tions

will

be

esta

blis

he

d

els

ew

here

in

th

e

cou

ntr

y

an

d

pro

vid

e j

obs.

The n

egative a

spect

to t

his

for

the

local

com

munitie

s

is

that

these

com

munitie

s m

ight

not

necessarily

have t

he

skill

s to c

om

pete

for

these n

ew

jobs w

ith n

ew

te

chno

logie

s,

and m

ight

not

be a

ble

to m

ove

to

wh

ere

these jobs w

ill b

e.

If t

hey f

ollo

w t

he

jobs,

there

is

still

pote

ntia

l fo

r socia

l ill

s

deve

lop

ing s

uch a

s fam

ily d

isru

ptio

ns c

aused

b

y m

igra

tio

n.

Ho

wever,

due t

o d

iscontin

ue

d

opera

tions

of

the

pow

er

sta

tions,

envir

onm

enta

l concern

s i

nclu

din

g w

ate

r an

d

CO

² em

issio

ns w

ill im

pro

ve.

Reco

mm

end

ations

Info

rmation

rela

ting

to

the

level

of

skill

s

requ

ired fo

r th

e options w

as not

availa

ble

. H

ow

ever,

sho

uld

th

ere

be a

nee

d fo

r n

ew

skill

s

sets

fo

r th

is

optio

n,

Eskom

shou

ld

consid

er

pro

vid

ing

skill

s

to

curr

ent

em

plo

yees

and

surr

oun

din

g

com

munity

mem

bers

in

pre

para

tio

n

for

the

imple

menta

tion

of

this

optio

n.

This

could

be

don

e t

hro

ugh t

he E

skom

Fou

ndation.

Info

rmation

rela

ting

to

the

level

of

skill

s

requ

ired fo

r th

e options w

as not

availa

ble

. H

ow

ever,

sho

uld

th

ere

be a

nee

d fo

r n

ew

skill

s

sets

fo

r th

is

optio

n;

Eskom

shou

ld

consid

er

pro

vid

ing

skill

s

to

curr

ent

em

plo

yees

and

surr

oun

din

g

com

munity

mem

bers

in

pre

para

tio

n

for

the

imple

menta

tion

of

this

optio

n.

This

could

be

don

e t

hro

ugh t

he E

skom

Fou

ndation.

Re-t

rain

ing o

f exis

tin

g e

mplo

ye

es i

n p

ota

ble

skill

s

to

affo

rd

them

op

port

un

itie

s

for

em

plo

ym

ent

els

ew

here

, or

altern

ative

liv

elih

oods,

is i

mport

ant. R

e-t

rain

ing s

ho

uld

id

eally

b

e

alig

ne

d

with

lo

cal

skill

s

deve

lopm

ent

and/o

r em

po

we

rment

initia

tives.

Altern

atively

, pla

ns

for

rede

plo

ym

ent

of

em

plo

ye

es to

neig

hbori

ng

po

we

r sta

tions,

or

severa

nce

packa

ges fo

r th

ose w

ho a

re r

ead

y t

o f

ind a

ltern

atives o

n

their o

wn s

ho

uld

be p

ut

in p

lace.

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

68

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Op

tio

n

1:

Lif

ex

an

d

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Op

tio

n

3:

Reb

uild

as

PF

o

r C

FB

C

(Dem

oli

sh

an

d R

eb

uil

d)

O

pti

on

4

: D

o

no

t re

new

(D

ec

om

mis

sio

nin

g)

Ke

y F

oc

us

Are

a:

Ba

se

lin

e i

nfo

rma

tio

n o

f th

e f

ou

r p

ow

er

sta

tio

ns

an

d v

uln

era

bil

ity a

ss

es

sm

en

t

Conclu

sio

ns

The s

ocio

eco

nom

ic d

ata

for

the f

our

po

we

r sta

tions

has

revea

led

ke

y

socio

-econ

om

ic

str

esses p

er

po

wer

sta

tion,

alb

eit i

n s

lightly

diffe

rent

levels

. T

hese are

d

epe

nd

ency o

n

the

po

wer

sta

tions

for

se

rvic

e

deliv

ery

, sig

nific

ant

levels

of

povert

y,

poor

housin

g

infr

astr

uctu

re,

hig

h l

oca

l un

em

plo

ym

ent

an

d

low

leve

ls o

f skill

s. B

ased o

n this

info

rmation,

this

optio

n m

ight

not

be a

ble

to c

hang

e t

his

socio

-econ

om

ic

sta

tus,

but

could

possib

ly

main

tain

the c

urr

ent sta

tus q

uo, ensuri

ng that

these com

mu

nitie

s are

n

ot

furt

her

pushe

d

into

povert

y.

The s

ocio

eco

nom

ic d

ata

for

the f

our

po

we

r sta

tions

has

revea

led

ke

y

socio

-econ

om

ic

str

esses p

er

po

wer

sta

tion,

alb

eit i

n s

lightly

diffe

rent

levels

. T

hese are

d

epe

nd

ency o

n

the

po

wer

sta

tions

for

se

rvic

e

deliv

ery

, sig

nific

ant

levels

of

povert

y,

poor

housin

g

infr

astr

uctu

re,

hig

h l

oca

l un

em

plo

ym

ent

an

d

low

leve

ls o

f skill

s. B

ased o

n this

info

rmation,

this

optio

n m

ight

not

be a

ble

to c

hang

e t

his

socio

-econ

om

ic

sta

tus,

but

could

possib

ly

main

tain

the c

urr

ent sta

tus q

uo, ensuri

ng that

these com

mu

nitie

s are

n

ot

furt

her

pushe

d

into

povert

y.

The s

ocio

eco

nom

ic d

ata

for

the f

our

po

we

r sta

tions

has

revea

led

ke

y

socio

-econ

om

ic

str

esses p

er

po

wer

sta

tion,

alb

eit i

n s

lightly

diffe

rent

levels

. T

hese are

d

epe

nd

ency o

n

po

we

r sta

tions for

serv

ice d

eliv

ery

, sig

nific

an

t le

vels

of povert

y, p

oor

housin

g in

frastr

uctu

re,

hig

h l

ocal

une

mplo

ym

ent

an

d l

ow

leve

ls o

f skill

s.

Based

on

this

in

form

ation,

if

no

t pro

perl

y m

ana

ged,

this

optio

n w

ill p

ote

ntially

in

cre

ase th

e le

vels

of

povert

y in

th

e are

a,

thus g

oin

g a

gain

st

the S

DG

s 1

, 2 6

and 7

.

Reco

mm

end

ations

Eskom

shou

ld

consid

er

pro

vid

ing

skill

s

to

curr

ent

em

plo

ye

es

and

surr

ou

ndin

g

com

munity m

em

bers

in

pre

para

tio

n fo

r th

e

imple

menta

tion

of

this

optio

n.

This

could

be

don

e t

hro

ugh t

he E

skom

Fou

ndation.

Eskom

shou

ld

consid

er

pro

vid

ing

skill

s

to

curr

ent

em

plo

ye

es

and

surr

ou

ndin

g

com

munity m

em

bers

in

pre

para

tio

n fo

r th

e

imple

menta

tion

of

this

optio

n.

This

could

be

don

e t

hro

ugh t

he E

skom

Fou

ndation.

Pota

ble

skill

s t

rain

ing f

or

exis

ting e

mplo

ye

es

to

aff

ord

th

em

opport

unitie

s

for

re-

em

plo

ym

ent

els

ew

here

, or

altern

ative

liv

elih

oods i

s i

mport

ant. A

ltern

ative

ly,

pla

ns

for

redep

loym

ent

of

em

plo

ye

es

to

neig

hb

ouri

ng po

we

r sta

tions,

or

severa

nce

packa

ges fo

r th

ose w

ho are

re

ad

y to

fin

d

altern

atives s

hould

be p

ut

in p

lace.

Ke

y F

ocu

s A

rea:

Co

ntr

ibu

tio

n t

o t

he lo

cal,

reg

ion

al an

d n

ati

on

al

eco

no

my

Conclu

sio

ns

As p

art

of

Eskom

, th

ese f

our

po

wer

sta

tion

s

contr

ibute

sig

nific

antly t

o t

he e

conom

y o

f th

e

are

a. In

tota

l, E

skom

add

ed s

om

e R

53 b

illio

n

in re

ven

ue to

govern

ment

in financia

l year

201

4/1

5.

When

consid

eri

ng

direct

and

in

duced

effects

, i.e.

goods

and

serv

ices,

Eskom

’s i

mpa

ct

was e

stim

ate

d t

o b

e m

ore

th

an 5

% o

f th

e G

DP

in fin

ancia

l year

201

4/1

5

(KP

MG

R

eport

, undate

d).

T

his

optio

n

will

m

ain

tain

th

e

curr

ent

sta

tus

quo

but

als

o

contin

ue

the

contr

ibutio

n

of

the

po

wer

sta

tions to

wa

rds th

e G

DP

fo

r a pro

long

ed

peri

od o

f tim

e.

As p

art

of

Eskom

, th

ese f

our

po

wer

sta

tion

s

contr

ibute

sig

nific

antly t

o t

he e

conom

y o

f th

e

are

a. In

tota

l, E

skom

add

ed s

om

e R

53 b

illio

n

in re

ven

ue to

govern

ment

in financia

l year

201

4/1

5.

When

consid

eri

ng

direct

and

in

duced

effects

, i.e.

goods

and

serv

ices,

Eskom

’s i

mpa

ct

was e

stim

ate

d t

o b

e m

ore

th

an 5

% o

f th

e G

DP

in fin

ancia

l year

201

4/1

5

(KP

MG

R

eport

, undate

d).

T

his

optio

n

will

m

ain

tain

th

e

curr

ent

sta

tus

quo

but

als

o

contin

ue

the

contr

ibutio

n

of

the

po

wer

sta

tions to

wa

rds th

e G

DP

fo

r a pro

long

ed

peri

od o

f tim

e.

Imple

me

nting

th

is

option

will

le

ad

to

a

decre

ase i

n t

he c

ontr

ibution o

f th

ese p

ow

er

sta

tions

to

the

natio

nal

and

regio

nal

econ

om

y.

This

im

pact

will

be

felt

more

in

tensely

at th

e r

egio

nal a

nd lo

cal scale

, th

us

furt

her

lead

ing

to

decre

ased

financia

l capacity o

f th

e p

rovin

ce a

nd m

unic

ipa

lity t

o

pro

vid

e s

erv

ice

s t

o t

he local com

munitie

s.

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

69

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Op

tio

n

1:

Lif

ex

an

d

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Op

tio

n

3:

Reb

uild

as

PF

o

r C

FB

C

(Dem

oli

sh

an

d R

eb

uil

d)

O

pti

on

4

: D

o

no

t re

new

(D

ec

om

mis

sio

nin

g)

Reco

mm

end

ations

Main

tain

the s

tatu

s q

uo.

Main

tain

the s

tatu

s q

uo.

In c

onsultation

with o

ther

pa

rtners

such a

s

govern

ment, lo

cal busin

esses s

uch a

s m

ines

and o

ther

ke

y p

laye

rs i

n t

he r

egio

n,

ide

ntify

and p

lan f

or

altern

ative m

ea

ns o

f ensuri

ng

contin

ue

d c

ontr

ibution t

o t

he e

con

om

y o

f th

e

regio

n.

Ke

y F

ocu

s A

rea:

Co

ntr

ibu

tio

n t

o t

he N

ati

on

al

Po

wer

Gri

d

Conclu

sio

ns

Shou

ld this

option b

e im

ple

me

nte

d, th

e life o

f th

e

po

we

r sta

tion

will

b

e

incre

ase

d

to

60

ye

ars

, th

us c

on

tinuin

g to a

ddre

ss the e

xis

tin

g

po

we

r constr

ain

ts in

th

e cou

ntr

y.

It is

als

o

possib

le

that

duri

ng

this

tim

e,

altern

ative

po

we

r gen

era

tion o

ptions c

ou

ld b

e f

ou

nd i

n

oth

er

are

as.

Shou

ld this

option b

e im

ple

me

nte

d, th

e life o

f th

e

po

we

r sta

tion

will

b

e

incre

ase

d

to

60

ye

ars

, th

us c

on

tinuin

g to a

ddre

ss the e

xis

tin

g

po

we

r constr

ain

ts in

th

e cou

ntr

y.

It is

als

o

possib

le

that

duri

ng

this

tim

e,

altern

ative

po

we

r gen

era

tion o

ptions c

ou

ld b

e f

ou

nd i

n

oth

er

are

as.

Takin

g the four po

we

r sta

tions o

ff the n

ationa

l po

we

r grid w

ill r

educe the n

atio

nal c

apacity o

f ele

ctr

icity

pro

vis

ion

associa

ted

with

load

shed

din

g a

nd th

e pote

ntial

incre

ase in

th

e

cost of energ

y. H

ow

ever,

it is

anticip

ate

d that

the ne

w build

po

we

r sta

tion

s (M

edupi

an

d

Kusile

) m

ight

augm

ent

for

the

loss o

f po

we

r gen

era

ted

at

these

po

we

r sta

tions,

thus

main

tain

ing t

he

curr

ent

sta

tus q

uo.

Reco

mm

end

ations

Main

tain

the s

tatu

s q

uo.

Main

tain

the s

tatu

s q

uo.

Investigate

th

e pote

ntial

for

incre

asin

g th

e

capacity

of

the

ne

wly

built

po

we

r sta

tions

(Medu

pi

an

d

Kusile

) to

augm

ent

en

erg

y

supp

ly.

Ke

y F

ocu

s A

rea:

En

gag

em

en

t w

ith

sta

keh

old

ers

Conclu

sio

ns

This

option

will

re

qu

ire

exte

nsiv

e

eng

ag

em

ent

with s

takeho

lders

in a

n a

ttem

pt

to m

anag

e e

xpecta

tio

ns a

nd

fears

but

als

o

keep

lines

com

munic

atio

n

ope

n

an

d

transpare

nt, a

nd g

rievances m

onitore

d.

This

option

will

re

qu

ire

exte

nsiv

e

eng

ag

em

ent

with s

takeho

lders

in a

n a

ttem

pt

to m

anag

e e

xpecta

tio

ns a

nd

fears

but

als

o

keep

lines

com

munic

atio

n

ope

n

an

d

transpare

nt, a

nd g

rievances m

onitore

d.

This

option

will

re

qu

ire

exte

nsiv

e

eng

ag

em

ent

with s

takeho

lders

in a

n a

ttem

pt

to m

anag

e e

xpecta

tio

ns a

nd

fears

but

als

o

keep

lines

com

munic

atio

n

ope

n

an

d

transpare

nt, a

nd g

rievances m

onitore

d.

Reco

mm

end

ations

Each

po

wer

sta

tion

is

allo

cate

d

a

com

munic

atio

ns m

anager/

offic

er

wh

o s

hou

ld

be

lea

din

g

this

engagem

ent

with

sta

keho

lders

. T

he

develo

pm

ent

of

a

Sta

kehold

er

Engagem

ent

Pla

n

(SE

P)

to

guid

e

these

eng

ag

em

ents

is

im

port

ant,

coup

led w

ith t

he p

rop

er

iden

tification o

f ke

y

sta

keho

lders

who w

ill p

ote

ntia

lly b

e a

ffecte

d

by t

his

option.

The S

EP

should

als

o p

rovid

e

guid

ance

on

is

sues

surr

oun

din

g

ke

y

messag

es

and

man

agin

g

sta

keho

lde

r re

lations

and

expecta

tions.

A

grieva

nce

s

Each

po

wer

sta

tion

is

allo

cate

d

a

com

munic

atio

ns m

anager/

offic

er

wh

o s

hou

ld

be

lea

din

g

this

engagem

ent

with

sta

keho

lders

. T

he

develo

pm

ent

of

a

Sta

kehold

er

Engagem

ent

Pla

n

(SE

P)

to

guid

e

these

eng

ag

em

ents

is

im

port

ant,

coup

led w

ith t

he p

rop

er

iden

tification o

f ke

y

sta

keho

lders

who w

ill p

ote

ntia

lly b

e a

ffecte

d

by t

his

option.

The S

EP

should

als

o p

rovid

e

guid

ance

on

is

sues

surr

oun

din

g

ke

y

messag

es

and

man

agin

g

sta

keho

lde

r re

lations

and

expecta

tions.

A

grieva

nce

s

Each

po

wer

sta

tion

is

allo

cate

d

a

com

munic

atio

ns m

anager/

offic

er

wh

o s

hou

ld

be

lea

din

g

this

engagem

ent

with

sta

keho

lders

. T

he

develo

pm

ent

of

a

Sta

kehold

er

Engagem

ent

Pla

n

(SE

P)

to

guid

e

these

eng

ag

em

ents

is

im

port

ant,

coup

led w

ith t

he p

rop

er

iden

tification o

f ke

y

sta

keho

lders

who w

ill p

ote

ntia

lly b

e a

ffecte

d

by t

his

option.

The S

EP

should

als

o p

rovid

e

guid

ance

on

is

sues

surr

oun

din

g

ke

y

messag

es

and

man

agin

g

sta

keho

lde

r re

lations

and

expecta

tions.

A

grieva

nce

s

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

70

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Op

tio

n

1:

Lif

ex

an

d

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Op

tio

n

3:

Reb

uild

as

PF

o

r C

FB

C

(Dem

oli

sh

an

d R

eb

uil

d)

O

pti

on

4

: D

o

no

t re

new

(D

ec

om

mis

sio

nin

g)

resolu

tion pro

cess shou

ld fo

rm part

of

the

SE

P.

The

SE

P

should

ta

ke

into

account

that

sta

keho

lder

gro

ups m

ight

respon

d d

iffe

rently

to d

iffe

rent

options.

Ap

pro

pri

ate

info

rmatio

n

and

messag

es

shou

ld

be

develo

pe

d

accord

ingly

.

resolu

tion pro

cess shou

ld fo

rm part

of

the

SE

P.

The

SE

P

should

ta

ke

into

account

that

sta

keho

lder

gro

ups m

ight

respon

d d

iffe

rently

to d

iffe

rent

options.

Ap

pro

pri

ate

info

rmatio

n

and

messag

es

shou

ld

be

develo

pe

d

accord

ingly

.

resolu

tion pro

cess shou

ld fo

rm part

of

the

SE

P.

The

SE

P

should

ta

ke

into

account

that

sta

keho

lder

gro

ups m

ight

respon

d d

iffe

rently

to d

iffe

rent

options.

Ap

pro

pri

ate

info

rmatio

n

and

messag

es

shou

ld

be

develo

pe

d

accord

ingly

.

Ke

y F

ocu

s A

rea:

Ris

k a

ss

essm

en

t

Conclu

sio

ns

Pote

ntial r

isks to E

skom

rela

ting to this

option

are

p

ote

ntial

econ

om

ic

and

ph

ysic

al

dis

pla

cem

ent,

com

munity

dis

satisfa

ctions,

unm

anag

ed

exp

ecta

tio

ns

and

co

ntinu

ed

dep

en

dence f

or

serv

ices b

y t

he m

un

icip

alit

y

and

local

co

mm

unitie

s.

Co

nseq

ue

nces

of

these r

isks a

re r

eputa

tiona

l d

am

ag

e a

nd t

he

lo

ss o

f a S

ocia

l Lic

ense t

o O

pera

te,

bu

dget

implic

atio

ns

for

resettle

me

nt,

com

munity

dis

satisfa

ctions,

wh

ich

could

als

o

lea

d

to

opera

tions a

nd

constr

uction t

ime d

ela

ys.

Pote

ntial r

isks to E

skom

rela

ting to this

option

are

p

ote

ntial

econ

om

ic

and

ph

ysic

al

dis

pla

cem

ent;

com

munity

dis

satisfa

ctions,

unm

anag

ed

exp

ecta

tio

ns

and

co

ntinu

ed

dep

en

dence f

or

serv

ices b

y t

he m

un

icip

alit

y

and

local

co

mm

unitie

s.

Co

nseq

ue

nces

of

these r

isks a

re r

eputa

tiona

l d

am

ag

e a

nd t

he

lo

ss o

f a S

ocia

l Lic

ense t

o O

pera

te,

bu

dget

implic

atio

ns

for

resettle

me

nt,

com

munity

dis

satisfa

ctions,

wh

ich

could

als

o

lea

d

to

opera

tions a

nd

constr

uction t

ime d

ela

ys.

Pote

ntial r

isks to E

skom

rela

ting to this

option

are

loss o

f dir

ect

and i

ndire

ct

em

plo

ym

ent,

safe

ty risks aro

und decom

mis

sio

ned sites,

and

unm

an

ag

ed

sta

keh

old

er

exp

ecta

tions.

Consequ

ences o

f th

ese r

isks a

re r

eputa

tion

al

dam

age a

nd t

he l

oss o

f a S

ocia

l L

icense t

o

Opera

te,

com

munity dis

satisfa

ctions,

wh

ich

could

als

o

result

in

litig

ation

risks,

and

financia

l im

plic

ations

for

ke

epin

g

the

sites

secure

d.

Reco

mm

end

ations

Pro

per

and

pla

nne

d

en

gagem

ent

with

sta

keho

lders

is r

equir

ed a

s p

art

of

the S

EP

. T

his

pla

n s

ho

uld

als

o p

rovid

e g

uid

ance o

n

issues s

urr

oun

din

g k

ey m

essages r

eg

ard

ing

th

e r

isks id

entified a

nd m

anagin

g s

takehold

er

rela

tions a

nd e

xp

ecta

tio

ns g

oin

g f

orw

ard

.

Pro

per

and

pla

nne

d

en

gagem

ent

with

sta

keho

lders

is r

equir

ed a

s p

art

of

the S

EP

. T

his

pla

n s

ho

uld

als

o p

rovid

e g

uid

ance o

n

issues s

urr

oun

din

g k

ey m

essages r

eg

ard

ing

th

e r

isks id

entified a

nd m

anagin

g s

takehold

er

rela

tions a

nd e

xp

ecta

tio

ns g

oin

g f

orw

ard

.

Pro

per

and

pla

nne

d

en

gagem

ent

with

sta

keho

lders

is r

equir

ed a

s p

art

of

the S

EP

. T

his

pla

n s

ho

uld

als

o p

rovid

e g

uid

ance o

n

issues s

urr

oun

din

g k

ey m

essages r

eg

ard

ing

th

e r

isks id

entified a

nd m

anagin

g s

takehold

er

rela

tions a

nd e

xp

ecta

tio

ns g

oin

g f

orw

ard

.

Ke

y F

ocu

s A

rea:

Nati

on

al,

reg

ion

al

an

d lo

cal

gen

era

tio

n c

oll

ab

ora

tio

n

Conclu

sio

ns

Shou

ld

Optio

n

1

be

imple

mente

d,

it

is

possib

le

that

togeth

er

with

the

ne

w

bu

ild

pro

jects

(M

edupi

an

d

Kusile

,)

there

could

pote

ntially

be s

urp

lus e

nerg

y f

or

the c

ou

ntr

y,

lea

din

g t

o c

hea

per

ele

ctr

icity o

vera

ll.

Shou

ld

Optio

n

2

be

imple

mente

d,

it

is

possib

le

that

togeth

er

with

the

ne

w

bu

ild

pro

jects

(M

edupi

an

d

Kusile

,)

there

could

pote

ntially

be s

urp

lus e

nerg

y f

or

the c

ou

ntr

y,

lea

din

g t

o c

hea

per

ele

ctr

icity o

vera

ll.

If O

ption 3 is

im

ple

me

nte

d fo

r an

y of

the

po

we

r sta

tion

s,

the

loss

of

genera

tio

n

capacity n

atio

nw

ide w

ill b

e a

ugm

ente

d b

y th

e

supp

ly f

rom

th

e n

ew

build

po

we

r sta

tions.

Reco

mm

end

ations

Main

tain

the s

tatu

s q

uo.

Main

tain

the s

tatu

s q

uo.

Impacts

re

lating

to

local

em

plo

ym

ent

an

d

local

eco

nom

ic

develo

pm

en

t should

ta

ke

pre

ce

dence

over

nation

wid

e

energ

y

requ

irem

ents

.



Response to Socio-Economic Consequences: Mitigation and Enhancement Measures

Pursuit of any of the three options assessed in this report will result in a variety of socio-economic

consequences. A number of these will be negative overall, with significant impacts on communities

and other stakeholders, and with the potential to generate negative sentiment, community

dissatisfaction and potential push back in the form of legal or other forms or recourse. In some

cases, the execution of specific options may have a net positive medium to long-term outcome.

Table 7-2 lists a series of mitigation and enhancement measures that might be considered for

particular options, at affected sites. The measures are described, and the context in which they

apply is outlined. The relevance of the measure to each of the options is then assessed. Whilst

socio-economic consequences vary somewhat from location to location, the variation is not

significant enough to warrant discussion site by site.

Some of these would be led and implemented by Eskom, whilst others could be undertaken in

partnership with others. Many of the mitigation and enhancement measures require significant lead-

time, and planning for implementation should begin timeously. The costs of the mitigation and

enhancement measures discussed here are not calculated for the purposes of this report, but the

potential for a cost should be taken into account in the evaluation of options.

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

72

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Tab

le 7

-2:

Mit

igati

on

an

d e

nh

an

cem

en

t m

easu

res

Mit

igati

on

/En

han

cem

en

t M

easu

re

Co

nte

xt

Re

leva

nc

e

Op

tio

n

1A

/1B

: L

ifex

an

d

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Op

tio

n

3A

/3B

: R

eb

uil

d as P

F o

r C

FB

C

(Dem

olish

an

d R

eb

uild

)

Op

tio

n

4:

Do

n

ot

ren

ew

(D

ec

om

mis

sio

nin

g)

Em

plo

yee

redeplo

ym

ent

and/o

r severa

nce

pla

nnin

g

and

im

ple

menta

tion

.

Inclu

des:

C

onsultatio

n a

nd e

nga

gem

en

t

P

lan

nin

g a

nd im

ple

me

ntin

g r

ede

plo

ym

ent

to o

ther

functions/o

pera

tions

P

lan

nin

g a

nd im

ple

me

ntin

g b

enefit

continu

ation/r

ep

lacem

ent

P

lan

nin

g a

nd im

ple

me

ntin

g s

evera

nce o

ptio

ns

Direct

em

plo

ym

ent

(perm

anent

and

contr

act)

Arr

ang

em

ents

fo

r te

mpora

ry

red

eplo

ym

ent

or

short

-term

la

y-o

ff

duri

ng r

efu

rbis

hm

ent

Arr

ang

em

ents

fo

r m

ediu

m

term

re

de

plo

ym

ent

and

fu

nction-r

ela

ted

se

ve

ran

ce

Full

red

ep

loym

ent

an

d

severa

nce

pla

nnin

g

and im

ple

menta

tion

Pre

-clo

sure

counselli

ng

an

d

capacity

build

ing

(short

te

rm

and

perm

anent

clo

sure

).

Inclu

des:

C

om

mun

icatio

n o

n o

pera

tion s

hort

sta

ffin

g a

nd/o

r clo

sure

arr

an

gem

ents

C

ou

nselli

ng o

n r

etire

ment

pla

nnin

g,

investm

ent, m

one

y

mana

gem

ent, d

ebt

man

ag

em

ent

A

dvic

e o

n s

mall

busin

ess d

evelo

pm

ent

and m

ana

gem

en

t

S

kill

s a

ssessm

ent

and t

arg

ete

d e

nh

ancem

en

t

Direct

em

plo

ym

ent

(perm

anent

and

contr

act)

Sm

all

se

rvic

e

pro

vid

ers

(e

specia

lly

em

po

we

rme

nt

com

panie

s)

Cou

nselli

ng

and

com

munic

atio

n

appro

pri

ate

to

part

ial

or

short

-term

clo

sure

Cou

nselli

ng

and

com

munic

atio

n

appro

pri

ate

to

m

ediu

m

-term

clo

sure

Cou

nselli

ng

and

com

munic

atio

n

appro

pri

ate

to

perm

anent

clo

sure

.

Full

suite o

f m

easure

s

Contr

acto

r /

serv

ice pro

vid

er

redeplo

ym

ent

and/o

r capacity build

ing

(latter

especia

lly in t

he c

ase o

f em

po

we

rment

contr

acto

rs).

Inclu

des:

C

onsultatio

n a

nd e

nga

gem

en

t

P

lan

nin

g a

nd im

ple

me

ntin

g r

ede

plo

ym

ent

to o

ther

functio

ns /

opera

tions

P

lan

nin

g a

nd im

ple

me

ntin

g b

usin

ess c

ou

nselli

ng f

or

sm

all

and

vuln

era

ble

co

ntr

acto

rs /

pro

vid

ers

Pro

cure

ment

Arr

ang

em

ents

fo

r te

mpora

ry r

ede

plo

ym

ent

A

rrang

em

ents

fo

r m

ediu

m

term

re

de

plo

ym

ent

and

possib

le

loss

of

conta

cts

du

e

to

chan

ges in f

un

ction

Full

red

eplo

ym

ent and /

or

busin

ess c

ounse

lling

Clo

sure

–re

late

d

sta

keho

lder

enga

gem

ent

(curt

aile

d

opera

tions,

tem

pora

ry a

nd p

erm

anent

clo

sure

).

Inclu

des e

ngag

em

ent

with:

E

mplo

ye

es (

se

e a

bove)

Loca

l govern

ment

S

upp

ly c

hain

contr

acto

rs

Direct

em

plo

ym

ent

Pro

cure

ment

LE

D a

nd C

SI

Serv

ice d

eliv

ery

Coal sourc

ing

Lan

d t

ake

As

appro

pri

ate

fo

r curt

aile

d op

era

tions an

d

tem

pora

ry c

losure

As

appro

pri

ate

fo

r m

ediu

m-t

erm

clo

sure

As

appro

pri

ate

fo

r perm

anent

clo

sure

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

73

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Mit

igati

on

/En

han

cem

en

t M

easu

re

Co

nte

xt

Re

leva

nc

e

Op

tio

n

1A

/1B

: L

ifex

an

d

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Op

tio

n

3A

/3B

: R

eb

uil

d as P

F o

r C

FB

C

(Dem

olish

an

d R

eb

uild

)

Op

tio

n

4:

Do

n

ot

ren

ew

(D

ec

om

mis

sio

nin

g)

Loca

l busin

ess a

nd s

erv

ice p

rovid

ers

R

eg

ula

tors

Asset

transfe

r pla

nnin

g a

nd

im

ple

menta

tio

n (w

here

a

sse

ts can be

don

ate

d/s

old

/tra

nsfe

rre

d t

o m

itig

ate

im

pacts

).

Inclu

des:

In

vento

ry o

f assets

(m

ovable

and im

movab

le)

In

form

ation o

n t

he u

se a

nd m

ana

gem

ent

of

imm

ovable

assets

Leg

al arr

ang

em

ents

for

asse

t tr

ansfe

r

S

takeho

lder

co

nsultation r

ega

rdin

g a

sset

transfe

r

C

ap

acity b

uild

ing f

or

asset

mana

gem

ent

(as n

ecessa

ry)

Direct

em

plo

ym

ent

Pro

cure

ment

LE

D a

nd C

SI

Serv

ice d

eliv

ery

Lim

ite

d

op

port

unity

for

asset

transfe

r, e

xcept

for

redu

nda

nt

assets

Modera

te

opp

ort

unity fo

r asset

tra

nsfe

r

Opport

un

ity

for

exte

nsiv

e

asset

tra

nsfe

r

Earl

y e

ng

ag

em

ent

and

care

ful

pla

nnin

g

requ

ired

to

secure

pote

ntial

Lan

d

access,

land

use,

and

lan

d

reh

abili

tatio

n

pla

nnin

g

and

im

ple

menta

tion

.

Inclu

des:

D

ete

rmin

atio

n o

f la

nd r

equ

ire

ments

, la

nd u

ses,

and

reh

ab

ilita

tion

respo

nsib

ilities u

nder

app

lica

ble

optio

ns

M

obili

sation o

f la

nd –

rela

ted e

ng

ag

em

ent

and p

lan

nin

g u

nder

app

lica

ble

options (

resettle

ment

action p

lan

nin

g in

the c

ase o

f dis

pla

cem

ent, land u

se a

nd la

nd b

eneficia

tio

n p

lann

ing w

he

re

lan

d m

ight

be r

ele

ased f

or

oth

er

uses,

and r

ehab

ilita

tion p

lannin

g

in t

he c

ase o

f clo

sure

Lan

d use a

nd

la

nd

ta

ke

Lan

d t

ake a

nd

land u

se

chan

ge u

nlik

ely

Lan

d

take

possib

le

for

expan

de

d

or

reconfigure

d

opera

tions

Beneficia

tio

n

possib

le

if

land

is

rele

ased

Full

clo

sure

and

re

ha

bili

tatio

n r

equ

ired

Opport

un

ity

for

lan

d

ben

eficia

tion

an

d

altern

ative la

nd

use

Serv

ice s

usta

inabili

ty p

lannin

g a

nd im

ple

me

nta

tion.

Inclu

des:

In

vento

ry o

f se

rvic

es p

rovid

ed

or

support

ed b

y t

he

opera

tion

(e

ducation,

he

alth,

wate

r an

d s

anitatio

n,

hou

sin

g,

security

/po

licin

g,

infr

astr

uctu

re m

ain

ten

an

ce

)

In

form

ation o

n m

ana

gem

ent

and c

osts

R

eq

uirem

ents

for

tem

pora

ry o

r perm

an

ent

op

era

tio

n a

nd

main

tenance b

y o

ther

part

ies

N

eg

otiatio

n (

allo

win

g s

uff

icie

nt

tim

e)

with o

rganis

ations a

ssum

ing

tem

pora

ry o

r p

erm

an

ent

resp

onsib

ility

Serv

ice d

eliv

ery

P

lan

nin

g

for

possib

le

tem

pora

ry

serv

ice

dis

ruption r

equ

ired

Pla

nnin

g f

or

possib

le

mediu

m t

erm

serv

ice

dis

ruption r

equ

ired

Pote

ntial

to

transfe

r serv

ice

respo

nsib

ilities

to

oth

er

part

ies

Full

transfe

r of

serv

ice

re

spo

nsib

ilities

requ

ired

SR

K C

on

su

ltin

g:

Pro

ject

No

: 5

06

50

3 S

IA E

sko

m F

lee

t R

en

ew

al

Pa

ge

74

BR

AV

/MA

LA

/HA

RA

/BR

AN

/MA

VA

F

INA

L S

IA R

epo

rt_

Esko

m_

srk

_5

06

50

3_0

3022

017

Fe

bru

ary

20

17

Mit

igati

on

/En

han

cem

en

t M

easu

re

Co

nte

xt

Re

leva

nc

e

Op

tio

n

1A

/1B

: L

ifex

an

d

Mo

dern

isati

on

(R

efu

rbis

hm

en

t)

Op

tio

n

3A

/3B

: R

eb

uil

d as P

F o

r C

FB

C

(Dem

olish

an

d R

eb

uild

)

Op

tio

n

4:

Do

n

ot

ren

ew

(D

ec

om

mis

sio

nin

g)

Econom

ic s

usta

inabili

ty p

lann

ing (

local a

nd r

egio

na

l).

Inclu

des:

P

rom

otio

n o

f econom

ic d

ivers

ific

atio

n (

thro

ugh inclu

siv

e s

ocia

l deve

lopm

ent

pla

nn

ing a

nd d

evelo

pm

ent

part

ners

hip

s).

M

ediu

m

to long t

erm

measure

E

sta

blis

hm

ent

of

dura

ble

multi-sta

keh

old

er

develo

pm

ent

institu

tio

ns (

for

exam

ple

a D

eve

lopm

ent

Fou

ndatio

n w

ith m

ultip

le

private

secto

r, p

ub

lic s

ecto

r a

nd c

om

mu

nity p

art

icip

ants

)

LE

D a

nd C

SI

Loca

l and

reg

ion

al

deve

lopm

ent

Susta

inabili

ty

pla

nn

ing

re

leva

nt

for

futu

re

clo

sure

Susta

inabili

ty

pla

nnin

g re

levant

for

futu

re c

losu

re

Shou

ld

sta

rt

we

ll in

adva

nce

of

decom

mis

sio

nin

g

if

possib

le

Enviro

nm

enta

l m

ana

gem

ent

pla

nnin

g.

Inclu

des:

D

ete

rmin

atio

n o

f enviro

nm

enta

l m

an

agem

en

t le

gal re

quir

em

ents

, ta

sks a

nd r

esp

onsib

ilities u

nd

er

diffe

rent

options (

inclu

din

g

perm

anent

clo

sure

)

P

repara

tion o

f re

vis

ed e

nvir

on

menta

l p

erm

itting p

rocesses a

nd

imple

menta

tion

arr

ang

em

ents

for

diffe

rent

options

B

riefin

g o

f re

gu

lato

rs r

eg

ard

ing p

lans a

nd im

ple

me

nta

tio

n

C

losure

an

d r

ehab

ilita

tion p

rogra

mm

e (

if r

eq

uire

d)

P

ublic

and s

takeho

lder

bri

efin

g o

n m

an

ag

em

ent

arr

an

gem

ents

M

onitori

ng a

rra

ngem

ents

Enviro

nm

enta

l im

pacts

M

ana

gem

ent

larg

ely

und

er

exis

ting fra

me

work

and p

lans

Req

uirem

ent

for

a

full

Enviro

nm

enta

l Im

pact

Assessm

ent

and

a

Waste

M

anag

em

ent

Lic

ence,

as w

ell

as th

e

revis

ion o

f th

e W

ate

r U

se

Lic

ence a

nd A

tmosph

eric

Em

issio

ns L

ice

nce

Mana

gem

ent

substa

ntially

unde

r e

xis

tin

g

fra

me

wo

rk

and p

lans

Req

uirem

ent fo

r a full

Enviro

nm

enta

l Im

pact

Assessm

ent

and

a

Waste

M

ana

gem

ent

Lic

ence,

as

well

as

the

revis

ion

of

the

W

ate

r U

se

Lic

ence

and

Atm

ospheri

c

Em

issio

ns L

ice

nce

Opport

un

ity

to

impro

ve

tech

nolo

gy

and

ma

na

gem

ent

regim

es

Full

clo

sure

envir

onm

enta

l m

ana

gem

ent

pla

nnin

g

and

imple

menta

tio

n

requ

ired.

De

pen

din

g

on t

he s

evera

l optio

ns

for

“Do n

ot

Re

ne

w”

Arn

ot and H

endrina w

ill

requ

ire a

nd a

for

a f

ull

Enviro

nm

enta

l Im

pact

Assessm

ent

and

a

Waste

M

an

agem

ent

Lic

ence

for

additio

na

l sto

rage

facili

ties

and

w

here

the p

lan

t is

sold

, th

e a

pplic

able

lic

ences

will

n

ee

d

to

be

tr

ansfe

rred

follo

win

g

the

applic

ab

le

am

en

dm

ent

pro

cess



Improving the Sustainability of the SED/CSI Initiatives

Following the review of the information received from the power stations and the Eskom Foundation,

the following recommendations could be made to improve the sustainability of the initiatives.

Multi-stakeholder collaboration: Collaboration between the power stations, Eskom, the

district and local municipalities, surrounding mines and other businesses is important to ensure

that resources are pooled and the impact of the projects are increased. The collaboration goal

could be to share project costs, management responsibilities and information;

Engagement with potential beneficiaries/communities: Assess community needs and

strengths and tailor the SED initiatives accordingly. This could also be through identifying

materials available locally for projects e.g. ash dams;

Research regarding local resources: Investigate the use of waste from power station

activities (grey water and recycled water) for vegetable gardening. Where there is excess water

from the power stations, investigate how this water can be used for community use. In installing

FGD components, consider the use of synthetic gypsum for establishing small businesses using

cement and grout, making wallboards, structural fill, mining applications, and road aggregate;

Diversification of economic activities: Promote economic diversification through inclusive

social development planning and development partnerships to ensure that projects identified

are not directly related to power station existence;

Food security projects: Identify land-based projects such as agriculture and stock farming to

respond to SDG2 of ending hunger and achieving food security; and,

Monitoring and evaluation: Following the implementation of the SED projects, conduct a post

implementation survey with the beneficiaries to assess the effectiveness of these projects and

to implement corrective measures where necessary.

Prepared by

Adel Malebana Anita Bron

Senior Social Scientist Principal Social Scientist

Reviewed by

Vassie Maharaj

All data used as source material plus the text, tables, figures, and attachments of this document

have been reviewed and prepared in accordance with generally accepted professional engineering

and environmental practices.



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the-economic-consequences-of-load-shedding-in-south-africa-and-the-state-of-the-electrical-

grid.html



Appendices



Appendix A: Interview Schedules



Stakeholder Engagement

The Senior Consultant Socio-economic Development, the Eskom Fleet Renewal Project Manager,

Ms Beauty Mazibuko, sent letters of introduction to the internal stakeholders and the stakeholders

at the power stations. The letter provided a brief background to the project, requesting their

attendance to meetings with SRK, and indicating the input required. For external stakeholders, the

Senior Manager for Stakeholder Management in Mpumalanga, Mr. Simangaliso Shongwe, invited

the IDP and LED Managers of the four municipalities within which the power stations fall. He also

accompanied SRK to these meetings.

Eskom Corporate Stakeholders

Meetings were held with the Eskom corporate stakeholders as reflected in Table A-1.

Table A-1: Meetings conducted with Eskom corporate stakeholders

Date of meeting

Purpose Meeting attendees Designation

15 September 2016

Engineering Technical Team meeting to provide a broad technical overview of the different options.

Beauty Mazibuko Senior Consultant: Socio-economic Development

Gina Downes Corporate Consultant: Environmental Economics

Tshifhiwa Tshamano Group Technology: Engineering

15 September 2016

Environmental Department meeting to gain an understanding of the different environmental implications of each of the options.



Tobile Bokwe Environmental Management

Kristy Langerman Environmental Management

Warren Funston Environmental Management

15 September 2016

Stakeholder engagement (Primary Energy) meeting to provide an overview of stakeholders at the different sites, how they are engaged, and what their issues are.


Sebata Zondo Stakeholder Management and Communication Practitioner

15 September 2016

Eskom Development Foundation meeting to provide inputs regarding the CSI activities at each of the sites, and the implications of each of these options on the current CSI activities.


Brenda Kruger Eskom Development Foundation

16 September 2016

Water Department meeting to provide input into water usage requirements per project site, and potential water requirements per option.


Dheneshree Lalla Chief Chemical Engineer : Chemical Centre of Excellence

Nthabiseng Dingaan Chemical Centre of Excellence

Annikie Moganelwa Boiler Auxiliary: Mechanical Engineer

Beauty Mazibuko

Gina Downes

Tshifhiwa Tshamano

Beauty Mazibuko

Gina Downes

Tobile Bokwe

Kristy Langerman

Warren Funston

Beauty Mazibuko

Sebata Zondo

Beauty Mazibuko

Brenda Kruger

Beauty Mazibuko

Dheneshree Lalla

Nthabiseng Dingaan

Annikie Moganelwa



Date of meeting


16 September 2016

Fuel Sourcing (Primary Energy Department) meeting to provide information regarding different sources of coal per station currently, and the sourcing requirements for each of the options.


Keith London Fuel Sourcing PED

16 September 2016

Project Manager to provide a broad overview of the project.


Beth O’ Connor Chief Advisor: Project Development

23 September 2016

Stakeholder Management to provide an overview of stakeholders at the different sites and how they are engaged.


Vanessa Carpel Corporate Affairs Business Partner

30 September 2016

Eskom Water Supply meeting to understand sources of water for each of the power stations.


Mpetjane Kgole Sustainability Manager: Water

Frits Thynsma Chief Technologist: Mechanical

Ian Midgley Chief Consultant: Water

Beauty Mazibuko

Keith London Fuel Sourcing PED

Beauty Mazibuko

Beth O’ Connor

Beauty Mazibuko

Vanessa Carpel

Gina Downes

Mpetjane Kgole

Frits Thynsma

Ian Midgley Chief Consultant: Water



Eskom Power Station Stakeholders

The following key stakeholders at the power stations were identified:

Power station managers;

Engineering managers;

Environmental managers;

Communications managers;

Maintenance managers; and,

Finance managers.

SRK conducted meetings at the four power stations as per Table A-2 below. The purpose of these

meetings was to get an understanding of the technical, environmental and community issues

regarding each power station.

Table A-2: Meetings conducted at the Eskom power stations

Power station and date of meeting


Hendrina Power Station

19 September 2016

The purpose of these meetings was to get an understanding of the technical, environmental and community issues regarding each power station.

Justice Ramagoma Environmental Manager

Aubrey Sambo Communications Manager

Morongwe Raphasha Engineering Manager

Ashwin Rampersad Acting Power station Manager

Arnot Power Station

21 September 2016

Beauty Mazibuko Climate Change and Sustainable Development Advisor

Teboho Ntshabiseng Communications Manager

Mariam Joseph Environmental Manager

Tshepo Mokgatle Engineering Manager

Komati Power Station

22 September 2016

Thabile Mahlangu Communications Manager

Lawrence Machebe Environmental Coordinator

Camden Power Station

7 October 2016

Sifiso Mzulwini Acting Engineering Manager

Fikile Sithole Environmental Coordinator

Augustine Sebothoma Maintenance Manager

Arnold Geuns Senior Manager Engineering and Maintenance

Thandiwe Mzoyi (Telecon)

Communication Officer

Mosekami Mokgala Finance Manager

Justice Ramagoma Environmental Manager

Aubrey Sambo Communications Manager

Morongwe Raphasha Engineering Manager

Ashwin Rampersad

Beauty Mazibuko

Teboho Ntshabiseng Communications Manager

Mariam Joseph Environmental Manager

Tshepo Mokgatle Engineering Manager

Thabile Mahlangu Communications Manager

Lawrence Machebe Environmental Coordinator

Sifiso Mzulwini

Fikile Sithole Environmental Coordinator

Augustine Sebothoma Maintenance Manager

Arnold Geuns

Thandiwe Mzoyi Thandiwe Mzoyi Thandiwe Mzoyi (Telecon)

Mosekami Mokgala Finance Manager



External Stakeholders

Eskom Climate Change and Sustainable Development (Eskom Fleet Renewal Project Team) raised

concerns regarding the possible pre-mature engagement of external stakeholders, which could

potentially lead to unmanaged stakeholder expectations of the project. Secondly, the project is still

at an early pre-feasibility phase and is treated as confidential. It was therefore decided that only the

relevant representatives at the district and local municipalities within which the power stations fall

would be interviewed. These are Gert Sibande and Nkangala District Municipalities, as well as

Msukaligwa and Gert Sibande Local Municipalities. The LED and IDP personnel were identified as

key informants to the socio-economic status as well as the social development of the areas under

discussion. Local communities were not engaged.

Table A-3 provides a list of meetings with the district and local municipalities.

Table A-3: Meetings with external stakeholders

Date of meeting

Organisation Meeting attendees Designation

28 September 2016

Eskom Simangaliso Shongwe Stakeholder Engagement


Pretty Chiloane Senior LED Manager

Msukaligwa Local Municipality Bongani Zwane IDP Manager

30 September 2016

Eskom Mpumalanga Smangaliso Shongwe Senior Advisor Stakeholder Management

Nkangala District Municipality Bheki Matimba Municipal Economist

Nkangala District Municipality Prince Magana Spatial Planning and Land Use

Steve Tshwete Local Municipality

Mike Nkosi LED Manager

Eskom Simangaliso Shongwe

Pretty Chiloane Senior LED Manager

Msukaligwa Local Municipality Bongani Zwane IDP Manager

Eskom Mpumalanga Smangaliso Shongwe

Nkangala District Municipality Bheki Matimba Municipal Economist

Nkangala District Municipality Prince Magana

Mike Nkosi LED Manager



Appendix B: Discussion Guides

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086

E: [email protected]

www.srk.co.za

Author/Reviewer Technical Discussion Guide 3-Feb-17

Eskom Generation Fleet Renewal Project:

Socio-Economic Study

Discussion Guide: Technical Team

Purpose

Establish a detailed overview of the 4 options that are being considered for each of the

power stations

Get an understanding of the current status of each power station

Cross reference certain findings with other internal discussions.

1 What is the current status of each Power Station?

1.1 Are they all coal fired? Where do they source this coal from and how is it transported

to site?

1.2 How long have they been in operation?

1.3 What is their current life expectancy and employment figures and/ or projections?

1.4 Does each plant have the same importance in the Eskom ‘fleet’ or are some

considered more strategically important?

2 Can you provide us with an overview of the 4 options that are being considered?

SRK Consulting Page 2

Author/Reviewer Technical Discussion Guide 3-Feb-17

2.1 What fuel source will be used for each option? (coal, biofuel, gas etc.)

2.2 Where would this fuel be sourced from?

2.3 How would this be transported to the site?

2.4 What timelines does each option have from start to finish?

2.5 Will the options at different sites be implemented simultaneously or will they be

phased?

2.6 Would any of the options require an expansion of the existing plant footprint?

Ownership of surrounding land in case of expansion and engagement with current

landowners?

2.7 What are the environmental impacts (air pollution, noise) of each option? (to be

confirmed with environmental team)

2.8 What are the water implications of each option? Will they require more or less water?

What will the implications be for surrounding communities and where would the water

be sourced from? (to be confirmed with the water team)

3 Would any of the options require additional employees or are they more

mechanised hence requiring fewer employees?

3.1 What preliminary plans are in place in cases of retrenchments?

3.2 What labour requirements will be considered should mechanisation take place?

4 From a purely technical and financial perspective, which options are currently

favoured and why?

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

Author/Reviewer Environmental Impacts Discussion Guide 3-Feb-17



Discussion Guide: Environmental Impacts

Purpose

Get an understanding of what the current and future environmental impacts might be.

Look in particular at impacts such as dust and noise.

1 What current environmental authorisations do the power stations have?

1.1 What new authorisations will be required for each of the new options?

1.2 Is there any current modelling particularly around air pollution?

1.3 What sort of monitoring is done around each of the power stations? Are there records

of this monitoring?

2 What is the role of the environmental officer at each of the power stations?

3 What current community grievances do the power stations encounter from an

environmental perspective?

3.1 Dust and air pollution in particular

3.2 Are the surrounding communities aware and active around environmental issues?

3.3 Have there been any health issues and/or claims at any of the power stations?

3.4 Are environmental NGOs active around any of the power stations?

4 Have there been any incidents and/or claims of water pollution emanating from

any of the power stations?

4.1 How do the power stations actively mitigate the possibility of water contamination

4.2 Is there ongoing monitoring of pollution?

5 Do any of the power stations contribute to any environmental causes?


Author/Reviewer Environmental Impacts Discussion Guide 3-Feb-17

5.1 Do any of the power stations have long term rehabilitation plans and closure plans?

6 Depending on the preferred option, what sort of mitigation measures do you think

might be necessary?

7 From a purely environmental perspective, what would the preferred option be?

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

Author/Reviewer Stakeholder Engagement Discussion Guide 3-Feb-17



Discussion Guide: Stakeholder Engagement

Purpose

Get an understanding of the key stakeholders at each of the four sites and how Eskom

engages with them

Look in particular at the stakeholder engagement programmes for communities at all

the four Power Stations

1 Key stakeholders and organisations at each of the sites (database)

1.1 Who are the key stakeholders?

1.2 How do you define a key stakeholder?

1.3 What is the importance or role of these stakeholders in Eskom’s operations?

2 Is there a stakeholder engagement plan for the communities at the four sites and

how does it work in terms of the following?

2.1 Focus of engagement

2.2 Means of engagement

2.3 Frequency of engagement

3 Would any of the options require additional employees or are they more

mechanised hence requiring fewer employees?

3.1 What preliminary plans are in place in cases of retrenchments?

3.2 What labour requirements will be considered for each of the options?

4 What relationships exist between Eskom and their key stakeholders and

organisations? Is it positive, negative or neutral?


Author/Reviewer Stakeholder Engagement Discussion Guide 3-Feb-17

5 Stakeholder networks: What relationships are there between the key

stakeholders?

6 Stakeholders’ power and influence: Which stakeholders have the influence in the

communities to positively or negatively affect the operations?

7 Stakeholder issues at each of the four Power Stations?

7.1 What are the key issues?

7.2 How can these issues be resolved and by whom?

7.3 Have there been times where operations had to stop because of stakeholder issues?

How was this resolved?

8 What engagement strategy is being planned to communicate the options to the

key stakeholders and by when?

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

Author/Reviewer Water Discussion Guide 3-Feb-17



Discussion Guide: Water

1 Where do the Power Stations get their supply of water from?

2 Do the Power Stations have Water Use Licences?

2.1 Are the Power Stations currently adhering to the conditions of the WUL?

2.2 If not, what management measures have been put in place to ensure adherence?

3 Do any of the stations currently supply surrounding communities and/or

municipalities with water?

3.1 Is this potable water or is it utilised for other purposes such as agriculture?

3.2 Do the communities pay for the water?

3.3 Are there any existing agreements regarding this and with whom?

3.4 How long are these agreements for?

4 What challenges are the Power Stations experiencing regarding water currently,

and how are these being managed?

4.1 How will these affect the options under discussion?

5 Are there any water saving mechanisms that the Power Stations are already

embarking on, and how will these affect any of the options discussed?

6 Which of the 4 options will have significant water implications and how? Will there

be a requirement for more or less water?


Author/Reviewer Water Discussion Guide 3-Feb-17

6.1 If they require more water, will this have any potential implications on the

communities’ current water supply?

6.2 Will they continue getting water, or if they do not pay for water currently, will there be

a need to start paying for water?

6.3 If water is no longer available for the communities based on the demands for any of

the options, are there any specific plans for alternative water supply? Will the

municipalities have the resources to supply additional water if required?

7 What happens during drought periods, do any of the communities that rely on

Eskom for water supply experience water restrictions? How is this communicated

to the communities and what are the reactions?

8 Have there been instances at any of the Power Stations where communities

expressed concerns regarding the quality of water and how are these managed?

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

Author/Reviewer Eskom Foundation Discussion Guide 3-Feb-17



Discussion Guide: Eskom Foundation

Purpose

Get an understanding of the key focus areas of the Eskom Foundation

Look in particular at the programmes in communities surrounding the four power

stations and their impacts

1 What is Eskom Foundation’s current involvement at the four Power Stations?

1.1 Which communities and which groups are beneficiaries?

2 Current status of these projects/ programmes per site?

3 Criteria for selecting key beneficiaries and how does one qualify to become a

beneficiary?

4 What are the impacts of these projects and programmes on the surrounding

communities in terms of:

4.1 Employment

4.2 Skills development

4.3 Capacity building

4.4 Procurement

4.5 Other?

5 Have there been any incidences where the projects or programmes could not be

implemented and how was this managed?

6 Who are the key developmental partners at the four sites?

7 What are the key developmental priorities for each of the 4 sites into the future?

8 How resilient are the communities in these areas in terms of their capacity to

absorb change?

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

Author/Reviewer Nkangala and Steve Tshwete 3-Feb-17



Discussion Guide: Nkangala and Steve Tshwete Municipalities

Purpose

Socio-economic information for communities surrounding Hendrina, Komati and Arnot

Power Stations.

Key stakeholders and community groups at the above power stations and how the

Municipalities engage with them.

Potential impacts of the above power stations on the municipalities and surrounding

communities

1 Socio-economic data of the affected communities- demographics, employment,

income, skills, education, health, services, infrastructure etc.

2 What are the communities and key stakeholders around Hendrina, Komati and

Arnot Power Stations? What are their needs, issues, interests and what power or

influence do they potentially wield?

3 How are these stakeholders engaged by the municipalities?

4 What community issues and grievances are commonly recorded and how are

these addressed?

5 Is there a structured engagement process between the power stations and the

Municipalities and how is this carried out?

6 Are there any commitments made by the municipalities to the surrounding

communities and what are the implications for the different options?

7 What are the current CSI, IDP and LED commitments made by the Municipalities

to the surrounding communities? Do the power stations play a role in this

process?


Author/Reviewer Nkangala and Steve Tshwete 3-Feb-17

8 How dependent are the surrounding communities and the municipality on the

Power Stations, and how will these be affected by the different options? E.g. water

provision, employment etc.

9 What were the social and economic impacts of the mothballing of Power Stations

and the Return to Service?

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

Author/Reviewer Gert Sibande and Msukaligwa 3-Feb-17



Discussion Guide: Gert Sibande and Msukaligwa Municipalities

Purpose

Socio-economic information for communities surrounding Camden Power Station.

Key stakeholders and community groups at the above power stations and how the

Municipalities engage with them.

Potential impacts of the above power stations on the municipalities and surrounding

communities

1 Socio-economic data of the affected communities- demographics, employment,

income, skills, education, health, services, infrastructure etc.

2 What are the communities and key stakeholders around Camden Power Station?

What are their needs, issues, interests and what power or influence do they

potentially wield?

3 How are these stakeholders engaged by the municipalities?

4 What community issues and grievances are commonly recorded and how are

these addressed?

5 Is there a structured engagement process between the power stations and the

Municipalities and how is this carried out?

6 Are there any commitments made by the municipalities to the surrounding

communities and what are the implications for the different options?

7 What are the current CSI, IDP and LED commitments made by the Municipalities

to the surrounding communities? Do the power stations play a role in this

process?


Author/Reviewer Gert Sibande and Msukaligwa 3-Feb-17

8 How dependent are the surrounding communities and the municipality on the

Power Stations, and how will these be affected by the different options? E.g. water

provision, employment etc.

9 What were the social and economic impacts of the mothballing of Power Stations

and the Return to Service?

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

HARA Eskom Fleet – Hendrina PS 19 Sept 2016

Generation Fleet Renewal Project- Socio-Economic Study

Hendrina Power Station, 19 September 2016

Distribution: Andrew Hart (SRK Consulting)

Beauty Mazibuko (Eskom)

Ashwin Rampersad (Eskom)

Justice Ramagoma (Eskom)

Morongwe Raphasha (Eskom)

Agenda

1 Welcome and Introduction

2 Overview of the Fleet Renewal Project – Socio-economic studies

3 Information requirements and outcomes

4 Overview of the Hendrina Power Station

4.1 Technical/Engineering

4.1.1 Technical overview

4.1.2 Employment (direct and indirect)

4.1.3 Fuel sourcing

4.1.4 Strategic importance

4.2 Environmental

4.2.1 Air pollution

4.2.2 Water pollution and supply

4.2.3 Management plans and authorisations

4.2.4 Grievances and resolution

4.3 Stakeholder/community

4.3.1 Definition of the Zone of Influence (host communities)

4.3.2 Engagement and interactions (include local communities and municipality)


4.3.4 Current CSI/LED

5 General discussion and questions

6 Way forward and meeting close

Notice prepared by: Andrew Hart

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

HARA Eskom Fleet – Arnot PS 21 Sept 2016

Generation Fleet Renewal Project- Socio-Economic Study

Arnot Power Station, 21 September 2016

Distribution: Andrew Hart (SRK Consulting)

Beauty Mazibuko (Eskom)

Shamiel Jappie (Eskom)

Mariam Joseph (Eskom)

Tshepo Mokgatle (Eskom)

Agenda

1 Welcome and Introduction



4 Overview of the Arnot Power Station

4.1 Technical/Engineering

4.1.1 Technical overview


4.1.3 Fuel sourcing

4.1.4 Strategic importance

4.2 Environmental

4.2.1 Air pollution




4.3 Stakeholder/community


4.3.2 Engagement and interactions (include local communities and municipality)



5 General discussion and questions


Notice prepared by: Andrew Hart

SRK House

265 Oxford Road

Illovo 2196

P O Box 55291

Northlands 2116

South Africa

T: +27 (0) 11 441 1111

F: +27 (0) 11 880 8086


www.srk.co.za

MALA Eskom Fleet – Camden Power Station 06 October 2016

Generation Fleet Renewal Project: Socio-economic Study

Camden Power Station, 07 October 2016 at 08:45-09:45

Distribution: Beauty Mazibuko (Eskom), Adel Malebana (SRK), Ulindi Muller (Eskom),

Fikile Sithole (Eskom), Gerda Janse van Vuuren, (Eskom), Sifiso Mzuliwini (Eskom)

Thabiso Mpongo (Eskom)

Agenda

1 Welcome and introductions



4 Overview of Camden Power Station

4.1 Technical and engineering

4.1.1 Technical Overview


4.1.3 Fuel Sourcing

4.1.4 Strategic Importance

4.2 Environmental

4.2.1 Air pollution



4.2.4 Grievances and resolutions

4.3 Stakeholder/ Community


4.3.2 Engagement and interactions (local communities and the municipality

4.3.3 Grievances and resolutions


5 General discussions and questions


Notice prepared by: Adel Malebana



Appendix C: Regional Context



Regional Context: District and Local Municipal

Summary

For the purpose of this report, the regional ZoI describes the district and local municipal context of

the four Eskom power stations. The Arnot, Hendrina, and Komati power stations are located in the

Steve Tshwete Local Municipality within the Nkangala District Municipality, while Camden power

station is located in the Msukaligwa Local Municipality in the Gert Sibande District Municipality

(Figure C-1 and Figure C-2).

Figure C-1: Allocation of district and local municipalities in the regional ZoI

District Context


Nkangala District Municipality is one of three district municipalities in Mpumalanga Province, and

has its seat in Emalahleni in the Steve Tshwete Local Municipality. The Nkangala District

Municipality is further comprised of six local municipalities (Delmas, Dr J.S. Moroka, Emalahleni,

Emakhazeni, Steve Tshwete, and Thembisile). The Nkangala District Municipality contributes

32.0% to the overall Mpumalanga province and has a higher average annual population growth rate

than the province (Nkangala District Municipality IDP, 2016/2017).


Gert Sibande District Municipality, like Nkangala District Municipality, is one of three district

municipalities in the Mpumalanga Province, with its administrative seat in Ermelo in the Msukaligwa

Local Municipality. It is the largest district municipality in the province spatially, and covers a total of

40.0% of Mpumalanga’s surface area. It is made up of seven local municipalities (Govan Mbeki,

Albert Luthuli, Mkhondo, Msukaligwa, Lekwa, Pixley Ka Seme and Dipaleseng).

Important transport corridors in the Gert Sibande District Municipality are the N11, N3 and the

N17/N2, all of which are significant national and regional trade and transport routes.

SR

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Local Context


Steve Tshwete Local Municipality is located in the central part of Nkangala District Municipality,

150km east of Pretoria on the N4. Its towns are critical to numerous transport and development

corridors, including the Maputo Corridor (N4), Emalahleni/Steelpoort Mining Resource Link and

Emalahleni/Bethal/Richards Bay Corridor. Much of the economy and communication services of the

Steve Tshwete Local Municipality are focused on these transport corridors. The Steve Tshwete

Local Municipality is divided into three spatial settlement types, including:

The small agricultural service villages which service the rural and farming community, including

Kwa-Makalane, Mafube and Doornkop;

Leisure towns of Presidentsrus and Kranspoort, where development is regulated to prevent

identity and aesthetic loss; and,

Towns and villages associated with power stations and mine operations, which have been

developed by Eskom. These include Rietkuil, Pullenshope and Komati, all of which form part of

this specific study’s ZoIs. Other mine-based towns such as Blinkpan, Naledi and Lesedi are

home to many mine employees, and like the Eskom towns, are centres for social services and

amenities.

Coal mining and energy generation are big sectors in the Steve Tshwete Local Municipality, and as

a result, Steve Tshwete Local Municipality is a significant contributor to the Nkangala District

Municipality economy, contributing 35.0% to the district GDP in 2014. This is second only to

Emalahleni Local Municipality at 48.0% (Nkangala District Municipality IDP, 2016/2017).

Msukaligwa Local Municipality

The Msukaligwa Local Municipality is the third largest economy in Gert Sibande District Municipality

and comprises both rural and urban settlements, farmlands and nature reserves. The administrative

seat of the Msukaligwa Local Municipality is in Ermelo, which is 19.5km northwest of the Camden

power station. The Msukaligwa Local Municipality accounts for 14.3% of the Gert Sibande District

Municipality population, and the economy is based largely on finance, community services,

transport, trade and mining. Important centres include Ermelo, Breyten, Davel, Sheepmoor,

Chrissiesmeer, Lothair and Warburton (Municipalities of South Africa, 2016).

Like the Steve Tshwete Local Municipality, Msukaligwa Local Municipality is a transport hub in terms

of National roads, and its roads systems radiate outwards from Ermelo towards numerous trade

centres and ports, including Johannesburg (N17), Durban, Richards Bay (N2/N11) and Swaziland

(N17).

The age and gender composition of the population is a key

determinant of population change and dynamics. Age

distribution is an important indicator of both current and future

needs regarding education, health care for children and

elderly, employment opportunities for those in the economic

age group and provision of social services such as pensions

to those in need.



Demography

A summary table of demographic indicators collected from StatsSA Census 2011, with inputs from

IDP’s has been provided in Table C-1. Indicators across both districts and local municipalities

suggest the following general patterns for the region:

The majority of the population in the region is comprised of Black Africans;

Excluding Gert Sibande District Municipality, settlement distribution is largely urban, with

dispersed farm settlements throughout the Steve Tshwete Local Municipality;

Steve Tshwete Local Municipality has a high population growth rate, which exceeds all other

local municipalities in Nkangala District Municipality;

Across the regional ZoI, the majority of the population is of working age and below the ages of

35, with a high dependency rate associated with a significant youthful population below 18 years

old; and,

Females account for the larger portion of the populations in all but the Steve Tshwete Local

Municipality, where there is a larger male population, which may be liked to high levels of

migration into the Steve Tshwete Local Municipality discussed later on in this report.

SR

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Tab

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Su

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de

mo

gra

ph

ic t

ab

le f

or

dis

tric

t an

d lo

cal m

un

icip

aliti

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pp

licab

le t

o t

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eg

ion

al Z

oI

Are

a

(km

2)

Po

pu

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on

siz

e

Pers

on

s /

km

2

Se

ttle

me

nt

typ

e (

%)

20

01-2

01

1

Gro

wth

rate

(%

)

Po

pu

lati

on

Str

uctu

re

(%)

Ag

e(%

) G

en

der

rati

o (

%)

Urb

an

T

rad

itio

nal /

Farm

%

Po

pu

lati

on

g

rou

p

%A

ge g

rou

p

%F

M

Nkan

gala

D

istr

ict

Mu

nic

ipality

16 7

58

1 3

08 1

29

78

62.9

37.1

2.5

Bla

ck A

fric

an:

87.9

0-1

4 y

ears

28.5

51.9

48.1

White

9.9

15-6

4 y

ears

66.5

India

n/A

sia

n

0.7

65+

years

: 5.0

C

olo

ure

d

1.1

Oth

er

0.4

Ste

ve

Tsh

wete

L

ocal

Mu

nic

ipality

3 9

76

229 8

31

58

88.7

11.3

4.8

Bla

ck A

fric

an:

73.6

0-1

4 y

ears

25.0

48.0

52.0

White

21.8

15-6

4 y

ears

70.7

India

n/A

sia

n

1.6

65+

years

: 4.3

C

olo

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d

2.6

Oth

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0.4

Gert

S

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de

Dis

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un

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ality

31 8

41

1 0

43 1

94

33

39.0

61.0

1.5

Bla

ck A

fric

an:

88.6

0-1

4 y

ears

31.6

51.8

48.2

White

9.0

15-6

4 y

ears

63.9

India

n/A

sia

n

1.1

65+

years

: 4.5

C

olo

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d

1.0

Oth

er

0.3

Msu

kali

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a

Lo

cal

Mu

nic

ipality

6 0

16

149 3

77

25

80.1

19.9

1.8

Bla

ck A

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an:

88.1

0-1

4 y

ears

30.4

50.4

49.6

White

9.8

15-6

4 y

ears

65.5

India

n/A

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n

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: 4.1

C

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d

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11

.



Migration

Migration into the regional ZoI is above national average (0.9 migrants per 1 000 people), which

could be for a number of reasons including push factors from sending countries as well as pull

factors from South Africa, traditionally a labour intensive economy. Mining, industry and agriculture,

which are prevalent in the region would all attract outside work seekers in search of employment.

StatsSA census data suggests that there are a significant number of migrants coming from outside

of South Africa into the ZoI region (StatsSA, 2011). Figure C-3 below illustrates the in migration of

people from outside of South Africa between 2001 and 2011 into the ZoI region.

ESKOM SOCIAL BASELINE MIGRATION INTO REGIONAL ZOI FROM OUTSIDE

OF SOUTH AFRICA

Project No. 506503

Figure C-3: Migration into regional ZoI from outside of South Africa


Land Use

As outlined in Table C-2, land use in the regional ZoI can be broadly defined as largely residential,

with more agricultural (farm) land use occurring in the Gert Sibande District Municipality and

Msukaligwa Local Municipality. Industrial land uses occurred proportionately more in Steve Tshwete

Local Municipality than the other local and district municipalities, while informal residential

settlements were notably higher in Msukaligwa Local Municipality. Very little vacant land or parks

and recreational land was observed in any of the municipalities (StatsSA, 2011).

2007 2008 2009 2010 2011 Total

NDM 2 616 3 651 3 936 4 224 5 505 19 932

STLM 606 891 918 921 1 305 4 641

GSDM 1 458 1 839 2 241 2 391 2 964 10 893

MLM 210 267 285 303 336 1 401

0

5 000

10 000

15 000

20 000

25 000

No

of

mig

ran

ts



Table C-2: Land use in the regional ZoI

Land Use % of land

Nkangala DistrictMunicipality


Gert Sibande DistrictMunicipality


Formal Residential 54.7 80.8 61.5 67.1

Informal Residential 6.4 7.3 5.0 11.2

Traditional Residential 31.1 - 16.3 -

Farms 4.5 8.8 14.8 19.7

Parks and Recreation 0.0 0.1 0.1 0.1

Collective Living Quarters 1.1 1.1 0.7 1.2

Industrial 0.6 1.5 0.4 0.4

Small Holdings 1.1 - 0.8 -

Vacant 0.2 0.0 0.2 0.1

Commercial 0.4 0.5 0.4 0.1


Housing

Across all four municipal designations, most houses are brick structures on separate stands or

yards. However, traditional dwellings are more prevalent in Camden power station’s district and

local Municipalities, where perhaps the presence of more rural, farm-based livelihoods are apparent

and there are less mines and industry. Informal dwellings, in keeping with the higher population

growth rates and more labour intensive job opportunities, are more prevalent in the Nkangala District

Municipality and Steve Tshwete Local Municipality (StatsSA, 2011). A full breakdown of housing

types is provided in Table C-3.

Table C-3: Housing types in the regional ZoI

Type of main dwelling No. of houses per type





House or brick structure on a separate stand or yard

271 206 46 875 184 248 28 362

Traditional dwelling/hut/structure made of traditional materials

8 646 1 101 27 144 3 993

Flat in block of apartments 6 537 2 148 5 295 1 275

Cluster house in complex 1 407 504 723 87

Townhouse 2 895 1 092 1 299 156

Semi-detached house 1 374 441 1 260 51

House/flat/room in backyard 7 512 2 247 3 744 687

Informal dwelling/shack (in backyard) 15 849 4 014 13 509 1 509

Informal dwelling (shack not in backyard)

33 666 5 175 32 424 4 206

Room/flatlet not in back yard but on a shared property

4 419 624 1 311 213

Caravan or tent 435 114 321 54




Employment

As illustrated in Table C-4, employment in the regional ZoI is varied. The Steve Tshwete Local

Municipality has the highest percentage of working-aged (15+ years) employed people at 52.9%

and the lowest percentage of economically inactive people (30.9%). The Nkangala District

Municipality has the higher unemployment rate of the two districts, however it is marginal.

Dependency on the employed population can be assumed high, with all four municipalities occupied

by upwards of 30.0% not economically active people (StatsSA, 2011).

Table C-4: Employment levels in the regional ZoI

% of population





Employed 40.9 52.9 38.9 42.6

Unemployed 17.5 13.0 16.5 15.6

Discouraged work-seeker 4.9 3.1 5.3 5.4

Not economically active 36.7 30.9 39.4 36.4


Employment Sectors

A comprehensive breakdown of employment per sector is provided in Table C-5. Both community

services and trade feature as one of the top three employment sectors in the regional ZoI. The

locality of the municipalities on important transport and trade corridors can be seen as the reason

for the high employment in the trade sector.

Community services are a big employment sector in most parts of South Africa, with many social

service requirements and resources responsible for local and district population’s social services

and well-being. This is particularly true of the Nkangala District Municipality, which has a rapidly

growing population. Excluding the Msukaligwa Local Municipality, mining is also a significant

employment sector. In Msukaligwa Local Municipality, due to its rurality and land use, agriculture is

the second largest employment sector (StatsSA, 2011).

Table C-5: Employment sectors in the regional ZoI

Sector

% of population





Agriculture 3.4 5.6 9.9 20.3

Mining 18.3 22.7 8.4 9.8

Manufacturing 7.1 12.6 10.6 5.4

Utilities 3.8 2.2 1.5 0.7

Construction 7.0 6.7 6.7 5.3

Trade 20.0 19.4 22.1 17.7

Transport 4.5 3.1 3.6 5.4

Finance 11.5 6.7 9.8 5.7

Community Services 13.6 13.7 18.3 20.8

Private Household 10.7 7.2 9.1 8.9




Income

Annual household income is distributed similarly across the four municipalities (See Figure C-3).

The greatest prevalence of no income was found in the Nkangala District Municipality. However, the

Steve Tshwete Local Municipality had the lowest instance of no income households. Excluding the

Steve Tshwete Local Municipality, the most

prescribed income bracket was R19 601-

R38 200, which is classified as a low to

middle income bracket. This, along with the

remaining prescription to income brackets

suggests that the municipalities are made

up of households, which have relatively to

extremely low incomes, which are

exceeded by the needs and means by

which households require to live. This is

further exacerbated by household size, where larger households have very little income to equally

distribute amongst dependants as household size increases (NFM, 2013). Steve Tshwete Local

Municipality has the largest percentage of middle to upper income earners when compared to

Msukaligwa Local Municipality.

ESKOM SOCIAL BASELINE ANNUAL HOUSEHOLD INCOME IN THE REGIONAL

ZOI

Project No. 506503

Figure C-3: Annual household income in the regional ZoI


0

5

10

15

20

25

30

35

40

45

NDM STLM GSDM MLM

% o

f h

ou

seh

old

s

Municipality

none

R 1 - R 9 600

R 9 601 - R 38 200

R 38 201 - R 76 400

R 76 401 - R 307 600

R 307 601 - R 614 400

Over R 614 001

Household income is a useful variable to consider

because it brings to light the fact that although

households are comprised of individual members

of the community, income earning individuals are

not spread equally throughout these households.

Low or no income makes a household more

vulnerable.



Education

The level of education in all four

municipalities (Table C-6) is better than

the provincial average, with Nkangala

District Municipality having the best

education out of the two district

municipalities. In the Nkangala District

Municipality IDP 2016/2017, Steve

Tshwete Local Municipality is listed as the local municipality with the highest number of people over

20 with a matric, the highest matric pass rate, as well as the second lowest percentage of non-

educated people in the province (Nkangala District Municipality IDP 2016/2017).

The Gert Sibande District Municipality has the higher prevalence of non-educated people over 20;

however, primary education was higher in both the Gert Sibande District Municipality and

Msukaligwa Local Municipality when compared to Nkangala District Municipality and Steve Tshwete

Local Municipality. Secondary education levels were in line with the Nkangala District Municipality

in Gert Sibande District Municipality and Msukaligwa Local Municipality, but lower than Steve

Tshwete Local Municipality. Tertiary education, like much of South Africa and Mpumalanga, is low

which can be attributed to (amongst other reasons) lack of tertiary education campuses in the

municipalities (other than Further Education and Training (FET) colleges) as well as financial

constraints presented by attending tertiary institutes.

Table C-6: Highest education level achieved in regional ZoI

% of population over 20 years

NoSchooling

Primary Secondary Certificate/Diploma with less than Matric

Tertiary


9.6 32.6 55.8 0.4 1.6


7.2 27.8 61.7 0.6 2.7


10.4 35.4 52.3 0.3 1.7


9.9 33.7 54.4 0.4 1.7


The presence of rural, farm schools in the Gert Sibande District Municipality and Msukaligwa Local

Municipality provide many in the municipality with an education. In both instances of the Gert

Sibande District Municipality and Msukaligwa Local Municipality, primary school facilities exceed

secondary facilities (Gert Sibande District Municipality, 2016). This is reflected in the figures in Table

C-7, where there is a decline in level of education following primary school. As such it can be said

there is a link between the number of schools available and the number of students who are then

able to attend school.

The figures for Steve Tshwete Local Municipality are concerning, with a total of 45 schools, even

though the municipality has the best education levels of all four municipalities concerned. All four

municipalities have an FET college, but as mentioned previously, no university tertiary institution.

Skills levels are an important indicator, because employment of local personnel is important for local

economic development.

It could therefore be assumed that the number of educational facilities in the four municipalities does

not allow for the growth of the skills base in the area, which appears low.

Education and literacy levels are key indicators

of development in a population. Education

attainment levels as well as access to

education facilities are also important indicators

to take into account.



Table C-7: Educational facilities in the regional ZoI

Municipality Primary School

Secondary School

Combined School

Tertiary / FET Total


218 102 - 1 (5 FET campus’)

321


25 19 - 1 (FET) 45


150 77 - 1 228


96 12 7 1 116

Source: StatsSA, 2011; Msukaligwa Local Municipality IDP 2016/2017; Steve Tshwete Local Municipality IDP 2016/2017; Gert Sibande District Municipality Draft IDP 2016/2017; Nkangala District Municipality IDP 2016/2017.

Health

Healthcare Infrastructure

The healthcare facilities available to municipalities are illustrated in Table C-8. Both districts have a

similar number of facilities available, however the large populations in the districts, compounded by

accessibility mean these facilities are inadequate to cope with the populations healthcare needs.

Lack of beds, staff and chronic medication are all issues identified in IDPs for municipalities. Steve

Tshwete Local Municipality and Msukaligwa Local Municipality have very few healthcare facilities,

and only four mobile clinics each.

Table C-8: Healthcare facilities in the regional ZoI

Municipality Government Hospital

Private Hospitals

Primary Healthcare Clinics

MobileClinics

Total


9 - 86 21 116


1 0 13 4 18


9 - 81 28 118


1 1 10 4 16

Source: Msukaligwa Local Municipality IDP 2017/2017.

Common Ailments

The top ten most common causes of death in three of the municipalities (excluding Msukaligwa

Local Municipality) are listed in Table C-9. It is clear that HIV/Aids is a common cause of death

across the municipalities, and that Aids related deaths including TB, pneumonia and diabetes could

mean that HIV/Aids related deaths are in fact higher.

Road accidents and external accidental incidents feature highly and could be an indication of poor

road conditions as well as negligent driving and un-roadworthy vehicles.

The presence of stillbirth/premature births are concerning, and highlights birthing shortfalls in the

municipalities, in which resources, including beds, midwives and accessibility remain a problem for

the majority of the population.



Table C-9: Common ailments in the regional ZoI

Common ailment Municipality





Pneumonia Data not

immediately

available in

desktop format.

Acute respiratory infections Data not

immediately

available in

desktop format.

Bronchitis and bronchopneumonia

Immunesuppression/HIV/Aids

Head injuries arising from motor vehicle accidents

Gastro cardiac conditions/ heart disease

Diabetes

Mellitus

Stillbirths/prematurity

Tuberculosis

Diarrhoeal/intestinal disease

Road injuries

Meningitis/Encephalitis

Cerebrovascular disease

External causes of accidental injury

Source: Nkangala District Municipality IDP 2016/2017; Steve Tshwete Local Municipality IDP, 2016/2017; Department of Health, 2013

HIV/Aids

The HIV/Aids prevalence in the Nkangala District Municipality is the lowest in the province, however

HIV/Aids it nevertheless high. The prevalence has increased from 27.2% in 2010 to 34.5% in 2013

(7.0% increase). Rapid economic development, population growth, immigration, low education

levels and social pathologies (including crime and prostitution) can be linked to the increase over

the past few years. Access and inadequate protective and preventative knowledge in the rural parts

of the municipality are exacerbating factors. Steve Tshwete Local Municipality has experienced the

second highest increase in HIV/Aids prevalence in the Nkangala District Municipality (by 24.0%),

from 28.8% in 2010 to 52.2% in 2013 (Nkangala District Municipality IDP 2016/2017 and Steve

Tshwete Local Municipality IDP, 2016/2017).



In comparison, the Gert Sibande District Municipality has the highest HIV/Aids rate among women

(46.0% in 2012) which has repercussions for mother to child transfer levels in the district. Gert

Sibande District Municipality also has the highest infection rate in Mpumalanga, which as a province

has the second highest infection rate next to KwaZulu Natal (Department of Health, 2013).

Additionally, Gert Sibande District Municipality has a significant vulnerable group: namely HIV/Aids

orphans, who account for the largest orphan group in the district (Gert Sibande District Municipality

IDP, 20176/2017). According to the Department of Health, in 2013, Msukaligwa Local Municipality

had an HIV prevalence rate of 38.0%. Both the Gert Sibande District Municipality and the

Msukaligwa Local Municipality have been identified and are now involved in the National Health

Insurance pilot project, which aims to improve health infrastructure and services in areas where they

are most needed. Part of this includes the role out of anti-retroviral drugs, HIV/Aids testing and

counselling for those infected with the virus (News24, 2013).

Services Infrastructure

Transport

Transport covers both the road infrastructure and public transport system operating in the ZoI.

The main access roads in the ZoI are the N2 and N17. Provincial and regional roads include the

R35, R39, R65 and R542. There are a number of dirt roads that criss-cross the area linking these

official roads to settlements and amenities. The servicing of the provincial and district roads is the

responsibility of the Department of Transport, Nkangala District Municipality, Steve Tshwete Local

Municipality, Gert Sibande District Municipality and the Msukaligwa Local Municipality in their

respective municipal areas. The roads in the area are generally in a varied condition, ranging from

very poor (secondary and district roads that experience high volumes of heavy vehicle traffic as well

as those within informal settlements) to fair (in the case of the N2) condition. Based on Automobile

Association of South Africa (AA) assessment of the roads, a summary of the road types and

condition is summarised in Table C-10 (AA, 2016).

It should be noted that several of these roads are currently being upgraded or will be upgraded in

the future as part of general maintenance and improvement projects.

Table C-10: Provincial and district roads within the regional ZOI

Road Surface Type Road Condition

N2 Tar Fair to poor; uneven in places

N17 Tar The road is in fair to poor condition, uneven and potholed in places

R65 Tar Fair

R35 Fair to poor, subsistence in areas

R39 Tar Fair

Source: AA, 2016.

The primary form of transport throughout the area is walking. Public transport in the ZoI includes

private busses and mini bus taxis. Private busses do not service the outer lying areas of the regional

ZoI and generally stick to the provincial roads. Poor road conditions impact on the wear and tear of

the mini bus taxis and limit their services provided to the outer lying rural areas. As such, people

walk long distance to get to where they need to be.



Refuse Removal

Refuse removal services in the municipalities (Table C-11) are varied, with Steve Tshwete Local

Municipality having the most comprehensive removal services available, which is significantly better

than the district access, which can be deemed as low (49.7%). The percentage of people with no

access to refuse removal is low overall, however the use of households own refuse dumps is above

20.0% in all municipalities except Steve Tshwete Local Municipality (StatsSA, 2011). Rurality is

listed in both the Nkangala District Municipality and the Msukaligwa Local Municipality as a

constraint in access for refuse removal systems into areas that currently are not serviced

(Msukaligwa Local Municipality IDP, 2016/2017; Nkangala District Municipality IDP, 2016/2017).

Refuse removal access to those that are not serviced was listed in all four municipalities IDPs as an

issue and priority area.

Table C-11: Refuse facilities in the regional ZoI

Type of refuse removal % of households





Refuse removed by municipality or private company

49.7 86.3 64.6 66.9

Own refuse dump 39.8 9.6 25.0 20.9

No refuse removal 6.3 2.4 8.0 8.1

Other 4.2 1.7 2.5 4.1


Sanitation

As illustrated in Table C-12, a small percentage of the regional ZoI does not have access to any

sanitation facilities (below 3.0% in Nkangala District Municipality and Steve Tshwete Local

Municipality and 6.0% in Gert Sibande District Municipality and Msukaligwa Local Municipality).

However, access to flush toilet facilities is low (51.9%) in the Nkangala District Municipality when

compared to the other three municipalities. Steve Tshwete Local Municipality has the highest

percentage of people using flush toilets (84.6%), but also the highest number of people forced to

use bucket toilet for their ablutions (3.2%), an indication of high poverty and poor service delivery

experienced by those households. Although sanitation is improving in the regional ZoI according to

IDP’s, the use of pit toilets is still significant, particularly in the Nkangala District Municipality

(StatsSA, 2011).



Table C-12: Sanitation facilities in the regional ZoI

Type of sanitation

% of households





None 2.5 2.1 5.2 5.1

Flush toilets connected to a sewage system

49.4 82.6 65.8 74.7

Flush toilets with a septic tank

2.3 2.0 2.1 2.4

Pit toilets with ventilation

10.7 3.3 10.7 3.6

Pit toilet without ventilation

32.7 5.7 14.4 12.3

Chemical toilets 1.1 1.2 2.2 0.8

Bucket toilet system 1.3 3.2 0.8 1.2


Water

As provided in Table C-13, both the Steve Tshwete Local Municipality and Msukaligwa Local

Municipality have, generally, better access to piped water. Steve Tshwete Local Municipality has

the smallest instances of no access to piped water (1.8%), while Msukaligwa Local Municipality has

the highest number of households without access to piped water. The most prescribed source in

three of the municipalities is piped water in the house, however in the Nkangala District Municipality,

piped water in the yard is fractionally more (StatsSA, 2011).

In the Msukaligwa Local Municipality IDP (2016/2017), access to piped water is considered a

challenge due to the rurality of the local municipality; with projects underway to ensure that borehole

water can be accessed on farms. This is further challenging for the Msukaligwa Local Municipality

because there is resistance from landowners to allow access to boreholes on their property for

distribution to residents of rural Msukaligwa Local Municipality (Msukaligwa Local Municipality IDP

2016/2017). Water supply is a development priority in Steve Tshwete Local Municipality and access

to piped water on and off site increased from 88.9% in 1996 to 98.2% in 2011 (Steve Tshwete Local

Municipality IDP, 2016/2017).

Table C-13: Water sources in the regional ZoI

Source of Water % of households





No access to piped water 7.3 1.8 8.9 9.4

Piped water inside the house

40.6 62.2 44.3 53.0

Piped water in the yard 41.6 23.5 37.0 25.0

Communal standpipe 11.0 12.5 9.9 12.5




Electricity

Access to electricity for lighting is the highest electrical usage across the municipalities (Figure C-

4). Steve Tshwete Local Municipality has the largest percentage of households with access to

electricity for cooking, heating and lighting, however, electricity for heating remains moderate

(63.0%) (StatsSA, 2011).

ESKOM SOCIAL BASELINE ELECTRICITY ACCESS FOR COOKING, HEATING

AND LIGHTING IN THE REGIONAL ZOI

Project No. 506503

Figure C-4: Electricity access for cooking, heating and lighting in the regional ZoI


Electricity for cooking Electricity for heating Electricity for lighting

NDM 73.2 60.4 85.7

STLM 81.8 63.0 90.8

GSDM 62.9 49.4 83.4

MLM 49.1 42.7 74.7

0

10

20

30

40

50

60

70

80

90

100

% o

f p

op

ula

tio

n

Usage format (%)

NDM

STLM

GSDM

MLM



Appendix D: Local Context



Hendrina ZoI

Population Structure

StatsSA 2011 Census data shows that the population of the Hendrina ZoI is 28 287. Although no

figure was available it was stated in the Steve Tshwete Local Municipality IDP that there had been

an increase in the populations of wards 1, 2, 3 and 5. Reasons cited for the increase included the

in-migration of people from the greater Mpumalanga region and from neighbouring Southern African

countries, as well as the natural increase in the size of families (Steve Tshwete Local Municipality

IDP, 2016/2017). The portion of the population leaving the area is those aged between 16 and 25

who leave in an effort to find employment (StatsSA, 2011). A breakdown of population structure per

population group is provided in Table D-1 and represents a majority Black African population.

Table D-1: Population structure of Hendrina ZOI

Race Wards 1, 2, 3 and 5

Number

Black African 25 326

Coloured 228

Indian/Asian 99

White 2634

Total 28 287


Age and Gender

Attempting to understand the age distribution and gender stratification within the Hendrina ZoI is an

important process as this can help to determine future needs in terms of employment, service

delivery and health care.

The structure of the population in the ZoI appears to indicate that the majority of the population are

under the age of 35 years (Figure D-1) and the ZoI has an overall young population. There are

marginally more males than females in the population within the ZoI (StatsSA, 2011).



ESKOM SOCIAL BASELINE AGE TO GENDER DISTRIBUTION IN HENDRINA

ZOI

Project No. 506503

Figure D-1: Age to gender distribution in Hendrina ZoI, 2011


While a young population provides for a potentially physically strong workforce, this is also the age

bracket most likely to contract HIV/Aids (Aids.gov, 2016). This results in associated health and social

problems. Additionally, this age bracket is most likely to become despondent if tertiary education

and employment opportunities are lacking, which can lead to social pathologies, such as crime.

Finally, the high proportion of the population under the age of 15 increases the level of dependency

in the Hendrina ZoI.

Migration

In terms of migration into the Hendrina ZoI, migrants have been identified as largely foreigners (see

Table D-2) in search of living space and employment opportunities (StatsSA, 2011).

Table D-2: Migration into Hendrina ZoI

Province 2007 2008 2009 2010 2011

M F M F M F M F M F

Gauteng 3 3 - - - - - - - -

Mpumalanga 3 3 9 - - 3 3 3 3 -

Limpopo - - - - - - - - - 3

Outside SA 6 6 24 15 3 21 30 12 48 27

Sub-total 12 12 33 15 3 24 33 15- 51 30-

Grand Total 24 48 27 48 89


20 15 10 5 0 5 10 15

0 9

10 19

20 34

35 49

50 64

65 79

80+

% of population

Agegroup

Female

Male



Land Use and Ownership

As illustrated in Figure D-2, the major land use in the Hendrina ZoI is formal residential, which makes

up 87.7% of all land use. Ownership statistics from the StatsSA 2011 Census indicate that 39.0%

of the population rented accommodation, while 44.0% of the population occupy their properties rent-

free (StatsSA, 2011).

Land use

Wards

1, 2, 3 and 5

%

Formal Residential 87.7

Informal Residential 5.5

Traditional Residential -

Farms 3.7

Parks and Recreation -

Collective Living Quarters -

Industrial 2.8

Small Holdings -

Vacant -

Commercial 0.4

Figure D-2: Land use and ownership in the Hendrina ZoI


Housing

The Hendrina ZoI consists of 8 106 households (StatsSA, 2011). These households include free

standing formal structures, informal structures generally constructed from corrugated iron, and

traditional structures built using materials such as mud, stone, and sticks using traditional methods.

As indicated in Table D-4, the majority of housing in the Hendrina ZoI is formal housing (brick

structures on a separate stands or yards), however second to this is informal dwellings, largely

shacks. Influx and population growth has led to an increase in informal dwellings in informal

settlements and on farms, which can be attributed to the labour intense industries, including mining

and energy generation, in the Hendrina ZoI.

The Steve Tshwete Local Municipality is currently assisting the community with the roll out of

housing in a number of housing programmes, specifically the social housing and gap housing

initiatives. Social housing projects aim to provide 10 000 housing units in the next 10 years to low

income households, while the gap housing initiative includes a loan funded gap housing programme

and a self-help housing programme (Steve Tshwete Local Municipality IDP, 2016/2017).

39%

6%11%

44%

Ownership

Rented

Owned but notyet paid off

Occupiedrent-free

Owned andfully paid off



Table D-4: Housing types in Hendrina ZoI

Type of main dwelling

Wards 1, 2, 3 and 5

Number

House or brick structure on a separate stand or yard 6 777

Traditional dwelling/hut/structure made of traditional materials 117

Flat in block of apartments 90

Cluster house in complex 6

Townhouse 24

Semi-detached house 3

House/flat/room in backyard 57

Informal dwelling/shack (in backyard ) 351

Informal dwelling (shack not in backyard e.g. in an informal settlement or on a farm) 624

Room/flatlet (not in back yard but on a shared property) 48

Caravan or tent 9


Employment

Trends identified from an analysis of the available data sources (Table D-5) suggest that

unemployment in the Hendrina ZoI is moderate, however only 44.6% of the working age population

is employed. In addition, 32.2% of the population are not economically active, which indicates high

dependency on those that are employed (StatsSA, 2011).

Table D-5: Employment levels in the Hendrina ZoI

Employment level Wards 1, 2, 3 and 5

%

Employed 44.6

Unemployed 17.3

Discouraged work-seeker 5.9

Not economically active 32.2


Employment Sectors

The improved access to formal education since 1996 is likely to increase the number of people

available to be employed in skilled occupations. Much of those employed in the Hendrina ZoI are

employed on farms.

Table D-6: Employment sectors in Hendrina ZoI

Sector Wards 1, 2, 3 and 5

%

Formal 58.9

Informal 28.2

Private household 12.9




Table D-6 suggests that more than half of

those employed are employed in the

formal sector (58.9%), while 12.9% are

engaged in subsistence, home based

activities. The informal sector provides

significant employment at 28.2%

(StatsSA, 2011). The majority of

temporarily and formally employed people

in the area work in the local area.

Household Income

According to the StatsSA 2011 Census data and as provided in Table D-7, only 12.4% of households

in the Hendrina ZoI do not earn any income, while 29.2% respectively earn between R9 601.00 and

R38 200.00 (StatsSA, 2011). However, 35.0% of households are comprised of one person, and as

such, dependency is lower than other wards in the municipal area. This is indicative of migrant

labourers and those living in small rooms and informal room lets in informal settlements. Other

means of supplementing household incomes includes the growing of fruit and vegetables and the

keeping of livestock, and 14.0% of the population rely on a household-based income.

Table D-7: Annual household income in Hendrina ZoI

IncomeWards 1, 2, 3 and 5

%

None 12.4

R 1 – R 4800 3.2

R 4801-R 9600 6.0

R 9601-R 19 600 11.6

R 19 601 – R38 200 17.6

R 38 201- R 76 400 20.0

R 76 401- R 153 800 15.3

R 153 801-R 307 600 9.1

R 307 601-614 400 3.5

R 614 001 – R 1 228 800 0.8

R 1 228 801 – R 2 457 600 0.4

Over R 2 457 600 0.3


Education

Education levels in the Hendrina ZoI are relatively high with only 7.4% of community members over

the age of 20 not having any form of education. The majority of the population have a secondary

school education (55.7%). The more

concerning factor in the Hendrina ZoI is the fact

that only 3.1% of the community over the age of

20 have any form of tertiary education (StatsSA,

2011). This is mainly due to the fact that tertiary

education it is too expensive for most

households to afford (Fin24, 2015). Education

statistics are included in Table D-8.

Despite a relatively high education level in the

area, Hendrina currently struggles to source

the required skills from the local communities

– Hendrina Power station, 2016.

Hendrina Power station currently employs

690 people, of which 665 are permanent.

The majority of the employees (97%) are

locally sourced from Pullens Hope. 76% of

employees are male while 24% are female

- Eskom, 2016.



Table D-8: Highest level of education for people over 20 years of age in Hendrina ZoI

Highest level of education attained Wards 1, 2, 3 and 5

%

No education 7.4

Primary School 33.4

Secondary School 55.7

Certificate/Diploma (without matric) 0.4

Tertiary Education 3.1


The exact number of schools in the Hendrina ZoI was not immediately known to the specialist.

The distance that some learners are required to walk to school will have detrimental effects on

access to education. Having to walk in excess of 10km daily is likely to reduce a learner’s desire

and ability to access education. Additionally, the high proportion of learners walking to school raises

issues of road safety and makes them susceptible to criminal activity (Pheladi, 2015). This is not

necessarily true of the Hendrina ZoI, however may be relevant for the few living in more rural parts

of the Hendrina ZoI.

Health Infrastructure

There is no hospital in the ZoI, with the closest hospital in Ermelo. There are two clinics in Hendrina

and one in Pullenshope. There are no clinics in ward 2, and upgrades are required to clinics in wards

1 and 5 (Steve Tshwete Local Municipality, 2016).

Issues raised by the community in ward 1, 2, 3 and 5 in terms of health infrastructure related

specifically to the absence of a mobile clinic and 24-hour clinic service in each ward (Steve Tshwete

Local Municipality, 2016).

Services and Infrastructure

Refuse Removal

As indicated in Table D-9, the majority of households in the Hendrina ZoI have either municipal or

private refuse removal services (87.8%). Only 1.7% of households do not have any sort of refuse

removal and therefore households are well serviced, which is in line with ease of access for services

in urban areas (StatsSA, 2011). Currently Hendrina provides all refuse removal services in

Pullenshope and the Woestalleen mines. The power station also utilises their own landfill site for

waste disposal.

Table D-9: Refuse facilities in the Hendrina ZoI

Type of refuse removal Wards 1, 2, 3 and 5

%

Refuse removed by municipality or private company 87.8

Own refuse dump 10.5

No refuse removal 1.7

Other 3.0




Sanitation

The availability and access to sanitation services is an important social service, and can often be

an indicator of a community’s social wellbeing. From Table D-10 it is clear that sanitation services

are improved and flushing toilets are utilised by 61.4% of the ZoI, and only 5.3% of households had

no sanitation facilities (StatsSA, 2011). Issues raised by communities in the ZoI in the 2016/2017

IDP for Steve Tshwete Local Municipality

suggest that most farms in the Hendrina

ZoI have no access to sanitation

infrastructure. Recent government

programmes have introduced Ventilation

Improved Pit Latrines (VIPs) into

communities. The lack of flushing toilets

is due mainly to infrastructural constraints such as limited access to running water (Steve Tshwete


Table D-10: Sanitation facilities in Hendrina ZoI

Type of sanitation Wards 1, 2, 3 and 5

%

None 5.3

Flush toilets connected to a sewage system 58.3

Flush toilets with a septic tank 3.1

Pit toilets with ventilation 9.0

Pit toilet without ventilation 19.7

Chemical toilets 2.6

Bucket toilet system 2.1


Water

The availability and access to reliable and clean drinking water is one of the fundamental services

required by communities. Access to piped water is good in the Hendrina ZoI, and only 1.6% of

households do not have access to piped

water. An estimated 98.4% of households

had access to a water connection either

in their yard, within their dwelling or at a

communal standpipe (StatsSA, 2016).

Areas without access were generally

more remote homesteads on farms. See

Table D-11 for complete statistics.

Table D-11: Water sources in the Hendrina ZoI

Source of water Wards 1, 2, 3 and 5

%

No access to piped water 1.6

Piped water inside the house 56.9

Piped water in the yard 32.0

Communal standpipe 9.5


Currently all sewerage from Pullens Hope is

treated at the Hendrina water treatment

works – Hendrina power station, 2016.

Hendrina currently provides both

Pullenshope and Woestalleen mine with

potable water and electricity – Hendrina




Electricity

Eskom is the sole distributor of bulk electricity in the Hendrina ZoI and electrical connections are

prevalent in the area, particularly in Pullenshope and Hendrina town. The availability of electricity

as an energy source is vitally important as households utilise it for cooking, heating and lighting. A

summary of StatsSA Census 2011 in Table D-12 concludes that:

The majority of households in the ZoI have access to municipal electricity; and,

The majority of households rely on electricity for cooking (69.8%), heating (66.6%) and lighting

89.7%).

Table D-12: Energy sources for cooking, heating and lighting in the Hendrina ZoI

Energy Source

Wards 1, 2, 3 and 5

%

Cooking Heating Lighting

Electricity 69.8 66.6 89.7

Gas 1.5 1.5 0.5

Paraffin 2.6 0.7 0.4

Candles - - 9.2

Wood 2.2 2.6 -

Charcoal 23.8 28.3 -

Solar 0.2 0.2 0.3




Arnot ZoI


StatsSA Census 2011 data and Table D-13 shows that the population of the ZoI is 5 817, made up

largely of Black African people (StatsSA, 2011).

Table D-13: Population structure of Arnot ZoI

Race Ward 7

Number

Black African 4 677

Coloured 42

Indian/Asian 3

White 1 095

Total 5 817


Age and Gender

The age distribution and gender structure of the population in the Arnot ZoI indicates that the

majority of the population are under the age of 35 years (Figure D-3) and the area can be classified

as having an overall young population. There are marginally more males than females in the

population within the Arnot ZoI (StatsSA, 2011).

ESKOM SOCIAL BASELINE AGE TO GENDER DISTRIBUTION IN ARNOT ZOI

Project No. 506503

Figure D-3: Age to gender distribution in Arnot ZoI


20 15 10 5 0 5 10 15 20

0 9

10 19

20 34

35 49

50 64

65 79

80 +

% of population

Agegroup

Male

Female



Migration

In terms of migration into the Arnot ZoI, it is minimal. However, migrants have been identified as

largely foreigners in search of living space and employment opportunities. Table D-14 represents

migration statistics (StatsSA, 2011).

Table D-14: Migration into Arnot ZoI

Province 2007 2008 2009 2010 2011

M F M F M F M F M F

Mpumalanga - - 3 - - - - - 3 -

Limpopo - - - - 3 - - - - -

Outside SA - - - - 9 6 3 - - 9

Sub-total - - - - 12 6 3 - 3 9

Grand Total - 3 18 3 12



As indicated in Figure D-4, primary land use in the Arnot ZoI is formal residential (62.1%), however

a significant amount of land is used for farming (24.9%) and industrial activities (13.1%). The land

use data supports economic sectors active in the area, as well as ownership statistics, which

suggest 53.0% of the population is renting (StatsSA, 2011). This would indicate a larger migrant

and or labour force renting in the area where they work.

Land use Ward 7

%


Informal Residential -


Farms 24.9



Industrial 13.1

Small Holdings -

Vacant -

Commercial -

Figure D-4: Land use and ownership in Arnot ZoI


53%

14%

16%

17%

OwnershipRented

Owned butnot yet paidoffOccupiedrent-free

Owned andfully paid off



Housing

The Arnot ZoI consists of 1 461 households (StatsSA, 2011). These households include free

standing formal structures, informal structures generally constructed from corrugated iron and


The majority of housing in the Arnot ZoI is formal housing or brick structures on a separate stands

or yards, however second to this is informal dwellings, largely shacks. A comprehensive account of

housing types in the Arnot ZoI is illustrated in Table D-15 (StatsSA, 2011). Influx and population

growth has led to an increase in informal dwellings in informal settlements and on farms. This can

be attributed to the labour intense industries, including mining and energy generation, in the Arnot

ZoI.

Like the Hendrina ZoI, the Steve Tshwete Local Municipality is currently assisting the community

with the roll out of housing in a number of housing programmes, specifically the social housing and

gap housing initiatives. Social housing projects aim to provide 10 000 housing units in the next 10

years to low income households, while the gap housing initiative includes a loan funded gap housing

programme and a self-help housing programme (Steve Tshwete Local Municipality IDP,

2016/2017).

Table D-15: Types of housing in Arnot ZoI

Type of main dwelling Ward 7

Number




Cluster house in complex -

Townhouse -



Informal dwelling/shack (In backyard) 3

Informal dwelling (shack not in backyard e.g. in an informal settlement or on a farm)

9

Room/flatlet (not in back yard but on a shared property) 3

Caravan or tent -


Employment

Trends identified from an analysis of the

available data sources and represented in

Table D-16 suggest that unemployment in

the Arnot ZoI is moderate, however only

38.9% of the working age population is

employed. A high percentage (39.2%) of the

population is not economically active, which

indicates high dependency on those that are

employed (StatsSA, 2011).

Arnot currently has 710 employees. The

majority of employees (93%) reside in

Rietkuil. Approximately 27% are female

and 63% male – Eskom, 2016.



Table D-16: Employment levels in Arnot ZoI

Employment level Ward 7

%

Employed 38.9

Unemployed 16.5




Employment Sectors


available to be employed in skilled occupations. Much of those employed in the Arnot ZoI are

employed on farms. Employment per sector is detailed in Table D-17.

Table D-17: Employment sectors in Arnot ZoI

Sector Ward 7

%

Formal 80.2

Informal 10.4



The vast majority of the population is employed in the formal sector (80.2%), while 9.4% are

engaged in subsistence, home based activities. The informal sector employs 10.4% (StatsSA,

2011). The majority of temporarily and formally employed people in the area work in the local area.

Household Income

According to the StatsSA 2011 Census data and illustrated in Table D-18, only 6.2% of households

in the Arnot ZoI do not earn any income, while 70% earn between R19 601.00 and R307 600.00.

However, 35.0% of households are comprised of one person, and as such dependency is lower

than other wards in the municipal area (StatsSA, 2011). This household size is indicative of migrant

labourers and those living in small rooms and informal room lets in informal settlements. Other

means of supplementing household incomes includes the growing of fruit and vegetables and the

keeping of livestock.



Table D-18: Annual household income in Arnot ZoI

IncomeWard 7

%

None 6.2

R 1 – R 4800 2.2

R 4801-R 9600 3.6

R 9601-R 19 600 8.4

R 19 601 – R38 200 12.0

R 38 201- R 76 400 19.6

R 76 401- R 153 800 20.8

R 153 801-R 307 600 17.6

R 307 601-614 400 7.4

R 614 001 – R 1 228 800 1.2

R 1 228 801 – R 2 457 600 0.4

Over R 2 457 600 0.4

Source: StatsSA, 2011

Education

Table D-19 suggests education levels in the Arnot ZoI are relatively high with only 7.4% of

community members over the age of 20 not having any form of education. The majority of the

population have a secondary school education (55.7%). The more concerning factor in the Arnot

ZoI is the fact that only 3.1% of the community over the age of 20 have any form of tertiary education

(StatsSA, 2011). This is mainly due to the fact that tertiary education it is too expensive for most

households to afford (Fin24, 2015).

Table D-19: Highest level of education for people over 20 years of age in Arnot ZoI

Highest level of education attained Ward 7

%

No education 7.4

Primary School 33.4





The exact number of schools in the Arnot ZoI was not immediately known to the specialist.


There is no hospital in the Arnot ZoI, with the closest hospital in Ermelo, and other healthcare

facilities are not immediately apparent on facility maps for the Arnot ZoI, however there is a clinic in

Rietkuil (Google Earth, 2016).

Issues raised by the community in the Arnot ZoI did not address healthcare facilities and

infrastructure.



Services and Infrastructure

Refuse Removal

The majority of households in the Arnot ZoI have either municipal or private refuse removal services

(75.7%). Only 2.2% do not have any sort of refuse removal and therefore households are well

serviced, which is in line with ease of access for services in urban areas (StatsSA, 2011). Refuse

facilities are outlined in Table D-20.

Table D-20: Refuse facilities in Arnot ZoI

Type of refuse removal Ward 7

%




Other 1.4


Sanitation


an indicator of a community’s social wellbeing. Table D-21 displays the StatsSA 2011 Census data

for sanitation in the Arnot ZoI. Sanitation services are improved and flushing toilets are utilised by

82.3% of the Arnot ZoI, and only 0.6% of households had no sanitation facilities (StatsSA, 2011).

Issues raised by communities in the Arnot ZoI in the 2016/2017 IDP for Steve Tshwete Local

Municipality suggest that waterborne sanitation facilities are required in Sikhululiwe Village (Steve

Tshwete Local Municipality, 2016).

Table D-21: Sanitation facilities in Arnot ZoI

Type of sanitation Ward 7

%

None 0.6








Water


required by communities. As per Table D-22, access to piped water is good in the Arnot ZoI, and

only 3.2% of households do not have access to piped water. A total of 96.8% of households had

access to a water connection either in their yard, within their dwelling or at a communal standpipe

(StatsSA, 2011). Areas without access included Sikhululiwe Township, which has poor service

delivery (Steve Tshwete Local Municipality, 2016).



Table D-22: Water sources in Arnot ZoI

Source of Water Ward 7

%






Electricity

Eskom is the sole distributor of bulk electricity in the Arnot ZOI, and household access to electricity

is good. The availability of electricity as an energy source is vitally important as households utilise

it for cooking, heating and lighting. A summary of StatsSA Census 2011 statistics concludes that:

The majority of households in the ZoI have access to municipal electricity; and,

The majority of households rely on electricity for cooking (81.6%), heating (80.9%) and lighting

(91.6%).

Access to electricity in Arnot ZoI is summarised in Table D-23.

Table D-23: Energy sources for cooking, heating and lighting in Arnot ZoI

Energy Source

Ward 7

%



Gas 0.4 0.6 0.4


Candles - - 7.4

Wood 10.0 10.4 -

Charcoal 6.2 7.3 -

Solar 0.2 0.2 0.2




Komati ZoI


As per Table D-24, the population of the Komati ZoI is estimated at 5 010 according to the StatsSA

2011 Census data. It has a majority Black African population and the white population second most

represented group in the ZoI (StatsSA, 2011).

Table D-24: Population structure of Komati ZoI

Race Ward 4

Number

Black African 3 966

Coloured 45

Indian/Asian 15

White 948

Other 6

Total 5 010


Age and Gender

There are more males than females in the Komati ZoI (StatsSA, 2011), which supports the

conclusion that migration is high in the area due to males seeking migrant work on mines and in

some instances, farms. The population spikes in the working age groups, particularly amongst the

20-34 year groups, which is another indication of immigration (Figure D-5).

ESKOM SOCIAL BASELINE AGE TO GENDER DISTRIBUTION IN KOMATI ZOI

Project No. 506503

Figure D-5: Age to gender distribution in Komati ZoI


30 20 10 0 10 20

0 9

10 19

20 34

35 49

50 64

65 79

80 +

% of population

Agegroup

Male

Female



Migration

Migration has been significant and gradually growing in the Komati ZoI since 2007 (Table D-25).

Although some migrants have come from within South Africa, the majority (123 known migrants)

have come from outside of South Africa (StatsSA, 2011). This is a trend across the country and

within Mpumalanga Province, and is a result of neighbouring countries working population travelling

to find perceived better living space and employment opportunities.

Table D-25: Migration into Komati ZoI

Province 2007 2008 2009 2010 2011

M F M F M F M F M F

North West - - 3 - - - - - - -

Mpumalanga - - - 3 - - - - 3 -

Outside SA 9 6 12 15 12 21 3 3 18 24

Unspecified 3 3 9

Sub-total 9 6 18 18 12 21 6 3 27 27

Grand Total 15 36 33 9 54

Source: StatsSA: Census 2011


As indicated in Figure D-6, the Komati ZoI has varied land uses, most of which is residential. (of

which 54.0% is formal and 27.6% informal). Land used for farming accounts for 17.4% of the Komati

ZoI. High informal and formal residential patterns suggest that in-migration is significant, and the

increasing population has led to urban sprawl and the growth of informal settlements, where most

occupants are renting (StatsSA Census, 2011).

Land use Ward 4

%


Informal Residential 27.6


Farms 17.4



Industrial 1.1

Small Holdings -

Vacant -

Commercial -

Figure D-6: Land use and ownership in Komati ZoI


67%3%

19%

11%

Ownership

Rented

Owned butnot yet paidoff

Occupiedrent-free



Housing

As per Table D-25, the Komati ZoI consists of 1 137 households. Unlike some neighbouring wards,

the Komati ZoI has very few traditional dwellings. The majority of houses are formal housing or brick

structures as well as Informal dwellings, largely shacks, many of which are to be found in Komati

(StatsSA, 2011). Influx and population growth has led to an increase in informal dwellings in informal

settlements and on farms, which can be attributed to the labour intense industries, including mining

and energy generation, in the Komati ZoI.

Table D-25: Types of housing in the Komati ZoI


Number




Cluster house in complex 6

Townhouse -



Informal dwelling/shack: In backyard 45

Informal dwelling (shack; not in backyard e.g. in an informal settlement or on a farm) 624

Room/flatlet not in back yard but on a shared property 3

Caravan or tent 3


Employment

The Komati ZoI has the lowest level of not economically employed population compared to the three

other ZoI’s (see Table D-26). Employment is estimated at 56.5% of the population, a positive

statistic. Only 14.7% are unemployed, however the 25.6% of the population that is not economically

active will be reliant on members of the household that are, thus creating a significant dependency

ratio for the ZoI (StatsSA, 2011).

Table D-26: Employment levels in Komati ZoI


%

Employed 56.5

Unemployed 14.7






Employment Sectors


available to be employed in skilled occupations. Many of those employed in the Komati ZoI are

employed on farms. A summary of employment per sector is in Table D-27.

Table D-27: Employment sectors in Komati ZoI

Sector Ward 4

%

Formal 82.1

Informal 12.4



The formal sector accounts for 82.1% of

all employment in the Komati ZoI, with

only 12.4% working in the informal

sector (StatsSA, 2011). Compared to

surrounding wards, the Komati ZoI has

a low number of people employed by

private households, indicating less

reliance on subsistence livelihoods.

Household Income

As indicated in Table D-28, a notable percentage of households do not earn an annual income

(17.9%), with the largest percentage of those earning an income of between R19 601.00 and

R153 800.00 annually (57.0%). With 55.3% of households only averaging one person, dependency

is relatively low in single households; however, in the 24.1% of households that have three or more

occupants, dependency can be expected to be higher (StatsSA, 2011).

Table D-28: Annual household income in Komati ZoI

IncomeWard 4

%

None 17.9

R 1 – R 4800 2.0

R 4801-R 9600 2.8

R 9601-R 19 600 6.4

R 19 601 – R38 200 16.7

R 38 201- R 76 400 23.4

R 76 401- R 153 800 16.9

R 153 801-R 307 600 8.9

R 307 601-614 400 3.7

R 614 001 – R 1 228 800 0.8

R 1 228 801 – R 2 457 600 0.3

Over R 2 457 600 0.3


Komati power station currently employs 470

people, of which 352 are permanent. The

majority of the employees (439) are sourced

from Emalahleni. 67% of employees are male

while 33% are female - Eskom, 2016.



Education

Table D-29 suggests education levels in

the Komati ZoI are positive, with 63.3%

having completed secondary school

over the age of 20. Only 7.9% of the

population over 20 have not received

any formal education. Like many wards

in the province, tertiary education

success is dire at only 0.7% of the population (StatsSA, 2011). This is again due to tertiary education

costs (Fin24, 2015) and accessibility constraints for those wards and municipalities that do not have

tertiary facilities in close proximity (Pheladi, 2015).

Table D-29: Highest level of education for people over 20 years of age in Komati ZoI


%

No education 7.9

Primary School 27.9





According to the Steve Tshwete Local Municipality, there is the need for either an additional or new

school in the Komati ZoI, and as such it has been listed as an urgent community need (Steve

Tshwete Local Municipality, 2016). It appears that there is a primary school (Laerskool Koorfontein)

in Komati Village, where the majority of the population reside (Google Earth, 2016). Rurality of farm

communities is listed as a constraint to education progress in the ZoI, and initiatives have been put

in place to improve public transport accessibility to schools in and around the ZoI. These include

the grading of roads in rural areas of the ZoI to allow learners to travel to and from school using

means other than walking, often across great distances (Steve Tshwete Local Municipality, 2016).


There is no hospital in the Komati ZoI and the nearest hospital is in Ermelo. The clinic in the ZoI

(located in Komati) requires maintenance, however while this was listed as a need by the

municipality, it was not a raised as a concern by the community (Steve Tshwete Local Municipality,

2016).


Refuse Removal

Referring to Table D-30, refuse disposal by the municipality or private companies is afforded to

55.1% of the population, and is focused in the urban pockets of the Komati ZoI (including Komati

Village). Only 1.8% of households that do not have any sort of refuse removal, while a significant

39.9% have their own refuse dumps (StatsSA, 2011). This is a hygiene concern and as such a

health hazard, as stagnant refuse can both pollute and degenerate the land and water on/in which

it sits.

Despite a positive education level in the area,

Komati currently struggles to source the

required skills from the local communities –

Komati power station, 2016.



Table D-30: Refuse facilities in Komati ZoI


%




Other 3.2


Sanitation

Sanitation in the Komati ZoI is varied (Table D-31); with urban pockets enjoying better services

when compared to rural and informal settlements. The availability and access to sanitation services

is an important social service, and can often be an indicator of a community’s social wellbeing.

Flushing toilets are utilised by 55.7% of the Komati ZoI, and a significant 18.1% of households had

no sanitation facilities available to them

(StatsSA, 2011). Issues raised by

communities in the Komati ZoI in the

2016/2017 IDP for Steve Tshwete Local

Municipality, did not identify sanitary needs;

however, statistics suggest the delivery of

sanitation can be improved upon (Steve

Tshwete Local Municipality, 2016).

Table D-31: Sanitation facilities in Komati ZoI

Sanitation type Ward 4

%

None 18.1








Water

The availability and access to reliable and

clean drinking water is one of the

fundamental services required by

communities. Access to piped water is good

in Komati ZoI (see Table D-32). There are

5.2% of households that do not have access

to piped water and 61.3% of households

that have access to a water connection either in their yard or within their dwelling. Communal

standpipes provide a substantial portion of the population with water at 33.6% (StatsSA, 2011).

Komati currently provides both water and

electricity to the Komati Village – Komati


Currently, the local municipality is responsible

for sanitation provision and services in Blinkpan

and Komati Village – Komati power station,

2016.



Table D-32: Water sources in Komati ZoI


%






Electricity

Eskom is the sole distributor of bulk electricity in the Komati ZoI. Electricity is available and used by

over 56.0% of households for cooking, heating and lighting. However, in the instance of heating,

18.5% of households have no resources available to them, and candles still account for a large

percentage of lighting in the Komati ZoI (37.4%). The availability of electricity as an energy source

is vitally important for households, and is described in Table D-33 (StatsSA, 2011). The Steve

Tshwete Local Municipality IDP for 2016/2017 indicated that Eskom had identified 373 houses in

the following areas for future electrification, many of which are located in the rural localities of the

Komati ZoI:

Big House Farm: 52;

Bronsy Farm: 18;

Haasfontein Farm:15;

Dericky's Farm: 15;

Gelug Farm: 20;

Mahlathini Farm: 180;

Schoeman Farm: 29;

Geluk Farm:8;

Komati: 12;

Driefontein Farm: 13; and,

General: 11.

Table D-33: Energy sources for cooking, heating and lighting in Komati ZoI

Energy Source

Ward 4

%



Gas 1.1 1.1 0.2

Paraffin 33.9 5.7 5.3

Candles - - 37.4

Wood 1.2 3.8 -

Charcoal 9.2 18.5 -

Solar 0.2 0.2 0.2

None 0.2 18.5 0.5




Camden ZoI


National census data (illustrated in Table D-34) shows that the population of the Camden ZoI is

7 269 (StatsSA, 2011). Although no figure was available it was stated in the Msukaligwa Local

Municipality 2016/2017 IDP that there had been an increase in the Camden ZoI population. Reasons

cited for the increase include the in-migration of people from the greater Mpumalanga region and

from neighbouring Southern African countries, as well as the natural increase in the size of families

(Msukaligwa Local Municipality, 2016). The largest portion of the population leaving the area is

those aged between 16 and 25 who leave in an effort to find employment.

Table D-34: Population Structure of Camden ZoI

Race Ward 11

Number

Black African 7 122

Coloured 18

Indian/Asian 18

White 111

Total 7 269


Age and Gender

Attempting to understand the age distribution and gender stratification within the Camden ZoI is an

important process. The structure of the population in the Camden ZoI appears to indicate that the

majority of the population are under the age of 35 years (Figure D-7) and the area can be classified

as having an overall young population. There are marginally more females than males in the

population within the ZoI (StatsSA, 2011).

ESKOM SOCIAL BASELINE AGE TO GENDER DISTRIBUTION IN CAMDEN ZOI

Project No. 506503

Figure D-7: Age to gender distribution in Camden ZoI


-15 -10 -5 0 5 10 15

0 - 9

10 - 19

20 - 34

35 - 49

50 - 64

65 - 79

80 +

% of population

Ag

e g

rou

p

Male

Female



While a young population provides for a potentially strong workforce, this is also the age bracket

most likely to contract HIV/Aids (Aids.gov, 2016), resulting in associated health and social problems,

and also the age bracket most likely to become despondent if tertiary education and employment

opportunities are lacking, which can lead to social problems, such as crime. In addition, the high

proportion of the population under the age of 15 increases the level of dependency in the Camden

ZoI.

Migration

Migration statistics appear incomplete for the Camden ZoI. StatsSA Census 2011 statistics suggest

there have been no migrations into the Camden ZoI between 2007 and 2011 (StatsSA, 2011);

however, this is unlikely if compared with migration patterns in surrounding wards and within

Mpumalanga province.


In terms of land use (see Table D-35), Camden ZoI has more designated farmland (37.7%) than

any of the other three ZoI’s. The remaining 62.34% of land use is formal residential. At 34.0%, the

Camden ZoI also has the highest number of residents living rent free (StatsSA, 2011), which is

indicative of a community typically living on the farms they are employed on, with their families.

Table D-35: Land use and ownership in Camden ZoI

Land use Ward 11

%


Informal Residential -


Farms 37.7



Industrial -

Small Holdings -

Vacant -

Commercial -


Housing

The Camden ZoI consists of 1 527 households (see Table D-36). These households include free

standing formal structures, informal structures generally constructed from corrugated iron and


The majority of housing in the Camden ZoI is formal housing made of brick on separate stands or

yard, however, traditional dwellings are the next most prevalent (StatsSA, 2011). Population growth

has led to an increase in informal dwellings in informal settlements and on farms, which can also be

attributed to seasonal farm work and ex-farm employees continuing to reside on farms following

termination of employment.

The Msukaligwa Local Municipality is currently assisting the farm community in Sheepmoor with the

consolidation and subdivision of land for housing; however dilapidated Reconstruction and

Development Programme (RDP) housing and lack of housing have been raised as issues by the

communities living in Sheepmoor and the KwaMahlafuna and De Emigrattie farm areas (Msukaligwa


27%

12%

34%

27%

Ownership

Rented

Owned but notyet paid off

Occupied rent-free

Owned and fullypaid off



Table D-36: Types of housing in the Camden ZoI


Number

House or brick structure on a separate stand or yard 873


Flat in block of apartments -

Cluster house in complex -

Townhouse -

Semi-detached house -


Informal dwelling/shack: In backyard 21

Informal dwelling (shack; not in backyard e.g. in an informal settlement or on a farm) 57

Room/flatlet not in back yard but on a shared property -

Caravan or tent -


It should be noted that the above table represents the type of structure of the main dwelling. Many

traditional homesteads in the Camden ZoI have more than one building on their property. Extra

buildings per homestead are likely to be used for housing extended family, ablution facilities and for

livestock such as chickens. Typically, the majority of these buildings would be made from traditional

materials and/or informal materials.

Employment

Trends identified from an analysis of

the StatsSA Census 2011 statistics

(Table D-37), suggest that

unemployment in the Camden ZoI is

low, however 41.5% of the population

are not economically active, which

indicates high dependency on the

31.6% of the population that are

employed (StatsSA, 2011).

Table D-37: Employment levels in Camden ZoI


%

Employed 31.6

Unemployed 17.8




Employment Sectors


available to be employed in skilled occupations. Much of those employed in the Camden ZoI are

thought to be employed on farms. Table D-38 provides a summary of the above (StatsSA, 2011).

Camden currently has 373 employees, 321 of

which are permanent. The majority of employees

(351) reside in Ermelo. Approximately 35% are

female and 65% male – Eskom, 2016.



Table D-38: Employment sectors in Camden ZoI

Sector Ward 11

%

Formal 69.8

Informal 23.5



Household Income

According to StatsSA 2011 Census data (illustrated in Table D-39), only 10.2% of households in the

Camden ZoI do not earn any income, while 42.5% earn between R9 601.00 and R38 200.00

(StatsSA, 2011). There are however 47.2% of households with four or more occupants, and as such

the household incomes is often stretched and insufficient to support whole households. This puts

an enormous amount of pressure on higher income earning individuals who often support the entire

household. Other means of supplementing household incomes includes the growing of fruit and

vegetables and the keeping of livestock, and 6.9% of the population rely on a household-based

income (StatsSA, 2011).

Table D-39: Annual monthly income in Camden ZoI

IncomeWard 11

%

None 10.2

R 1 – R 4800 3.6

R 4801-R 9600 10.0

R 9601-R 19 600 18.6

R 19 601 – R38 200 23.9

R 38 201- R 76 400 18.1

R 76 401- R 153 800 10.0

R 153 801-R 307 600 4.1

R 307 601-614 400 1.3

R 614 001 – R 1 228 800 -

R 1 228 801 – R 2 457 600 -

Over R 2 457 600 0.4


Education

Education levels in Camden ZoI

communities are moderate (Table D-40)

with 15.2% of community members over the

age of 20 not having any form of education.

Approximately 42.6% of the population

have a primary education and 41.5% a

secondary school education. The more

concerning factor in the ZoI is the fact that only 0.5% of the community over the age of 20 have any

form of tertiary education (StatsSA, 2011). This is mainly due to the fact that there is no tertiary

institution in the Msukaligwa Local Municipality and tertiary education is not readily available in the

more rural areas as it is too expensive for most households to afford (Fin24, 2015).

Education level in the area are not high

and as such, Camden currently struggles

to source the required skills from the local

communities – Camden power station,



Table D-40: Highest level of education for people over 20 years of age in Camden ZoI


%

No education 15.2

Primary School 42.6





Desktop studies suggest there are two primary schools and one secondary school in Sheepmoor

(Msukaligwa Local Municipality IDP 2016/2017).

The distance that some learners are required to walk to school will have detrimental effects on

access to education. Having to walk in excess of 10km daily is likely to reduce a learner’s desire

and ability to access education. Additionally, the high proportion of learners walking to school raises

issues of road safety and makes them susceptible to criminal activity (Pheladi, 2015). This is

particularly the case in an area with urban pockets and large rural spaces such as the Camden ZoI.


The closest hospital to the Camden ZoI is located in Ermelo, and as such, there are no hospitals in

the Camden ZoI. There is a clinic in Sheepmoor; however, it does not open on weekends according

to community members and operates for 8 hours a day, Monday to Friday (Msukaligwa Local

Municipality SDF, 2010 and Msukaligwa Local Municipality IDP, 2016/2017).


Refuse Removal

As illustrated in Table D-41, only 16.9% of households in the Camden ZoI have either municipal or

private refuse removal services, concentrated in the urban pockets of Camden. A moderate number

of households in the Camden ZoI do not have any sort of refuse removal (15.4%) and therefore

households are forced to dispose of their own refuse in their own refuse dumps (64.1%). This is

generally done by either burying or burning it. Sheepmoor does not have a refuse removal service

(Msukaligwa Local Municipality IDP 2016/2017; StatsSA, 2011).

Table D-41: Refuse facilities in Camden ZoI


%




Other 3.6


A lack of suitable refuse removal has both environmental and community health implications, and

the without regular servicing, refuse builds up can to the point that it spills over onto the area around,

it creating unhygienic conditions.



Sanitation


an indicator of a community’s social wellbeing. From the StatsSA Census 2011 data (Table D-42) it

is clear that pit latrines are the dominant sanitation method per household throughout the Camden

ZoI, and that as many as 19.4% of households had no sanitation facilities (StatsSA, 2011). Issues

raised by communities in Camden ZoI in the 2016/2017 IDP for Msukaligwa Local Municipality

suggest that low cost housing in Sheepmoor was without functioning sewerage systems, and as

such the community are forced to rely on pit latrines and in some instances, no facilities at all. The

KwaMahlafuna and De Emigrattie farm areas had new VIP toilets installed recently, but complained

they had since become full and could no longer be used (Msukaligwa Local Municipality, 2016).

Table D-42: Sanitation facilities in Camden ZoI

Type Ward 11

%

None 19.4








Water


required by communities. Access to piped water is poor in the Camden ZoI (see Table D-43), and

46.9% of households do not have access to piped water. However, 53.1% of households had access

to a water connection either in their yard, within their dwelling or at a communal standpipe (StatsSA,

2011). Areas without access are generally more remote homesteads on farms, which rely on

boreholes for water. Sheepmoor residents claim these boreholes dry up in winter, resulting in water

insecurity (Msukaligwa Local Municipality, 2016).

Table D-43: Water sources in Camden ZoI


%








Electricity

Eskom is the sole distributor of bulk electricity in the Camden ZoI. However, electrical connections

are not widely prevalent in the Camden ZoI due to disbursed settlement and the rurality of farms.

The availability of electricity as an energy source is vitally important as households utilise it for

cooking, heating and lighting. A summary of StatsSA Census 2011 statistics in Table D-44

concludes that (StatsSA, 2011):

The majority of households in the ZoI do not use municipal electricity for cooking and heating;

The majority of households rely on wood for cooking (60.5%) and heating (66.1%);

The majority of households rely on electricity for lighting (62.0%); and,

Despite this, candles are a significant source of lighting at 36.9%.

Table D-44: Energy sources for cooking, heating and lighting in the Camden ZoI

Energy Source

Ward 11

%



Gas 0.6 0.6 0.2


Candles - - 36.9

Wood 60.5 66.1 -

Charcoal 1.3 1.2 -

Solar - - 0.4


The Msukaligwa Local Municipality IDP (2016/2017) indicated that electrification was required in

parts of Sheepmoor as well as farm area in KwaMahlafuna and De Emigrattie. The IDP suggests

that this challenge is a result of some land owners are not willing to contribute towards electrification

of their farm dwellers accommodation. Five electrification projects (funded by Eskom) had been

undertaken in the following settlements:

34 units Thandanani Khululekani;

24 units Mbalenhle;

37 units Sizenzela;

31 units on The Siyanyakaza; and,

25 units on Hooland- Thuthukani.



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d oc

cur.

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ium

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utco

me

will

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n m

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eabl

e so

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econ

omic

impa

cts.

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e gr

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l occ

ur.

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ood

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me

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e a

pote

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ositi

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MA

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Weighting(1

3)

StatusQuo

Rating:Status

Quo

Option1:

Refurbishment

Rating:

Option1

Option3:Demolish

andRebuild

Rating:Option3

Option4:

Decommission

Rating:

Option4

Poor

Medium

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13

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33

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32

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13

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l Sou

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l 2

36

36

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cono

mic

33

93

92

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95

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er S

uppl

y 3

39

39

39

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33

93

93

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35

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33

93

93

91

35

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15

610

1115

Poor

Theoutcomewillhaveanoverallnegativesocioeconomicim

pact.Increasedgrievancesandcommunitydissatisfactioncouldoccur.

Medium

Theoutcomewillresultinmanageablesocioeconomicim

pacts.Somegrievancesmaystilloccur.

Good

Theoutcomewillhaveapotentiallypositivesocioeconomicresult

Land

Tak

e

Reg

iona

l and

Nat

iona

l

CAMDENPOWERSTATION

SocioeconomicConsiderations

Em

ploy

men

t and

Pro

cure

men

t

Env

ironm

enta

l Im

pact

s

LED

and

CS

I

Ser

vice

Del

iver

y



SRK Report Distribution Record

Report No. 506503/F1

Copy No. Electronic

Name/Title Company Copy Date Authorised by

Beauty Mazibuko Eskom Electronic 03/02/2017 MAVA

Gina Downes Eskom Electronic 03/02/2017 MAVA

Approval Signature:

This report is protected by copyright vested in SRK (South Africa) (Pty) Ltd. It may not be reproduced

or transmitted in any form or by any means whatsoever to any person without the written permission

of the copyright holder, SRK.

Beauty Mazibuko Eskom Electronic 03/02/2017 MAVA

Gina Downes Eskom Electronic 03/02/2017 MAVA

Eskom Generation Fleet Renewal Project: Socio-Economic Study

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Transcript of Eskom Generation Fleet Renewal Project: Socio-Economic Study