Kusile Power Station

The Kusile Power Station (formerly known as the Bravo Power Station) in South Africa is under construction by the state electricity utility Eskom.

It is expected that Kusile could consist of six 900 megawatt coal-fired generating units for a total generating capacity of 5,400 megawatts. Other reports state that the power station would have a total capacity of 4,800 megawatts.

Location
The project is located about 15 km north of the existing Kendal Power Station and about 20 km west of Witbank, Mpumalanga. The coordinates are -25.9200701, 28.924942.

Coal Supply
In the minutes of a stakeholder briefing, Eskom state that they "will obtain most of the coal required for Kusile Power Station from Anglo Coal's New Largo operations, south east of the Kusile Power Station."

According to a 2011 Sierra Club report, Eskom’s own consultants estimate that 35 new coal mines will be required to support the Medupi and Kusile plants.

Timeline

 * Department of Environmental Affairs & Tourism issued a positive Record of Decision on 5 June 2007.
 * February 2008: Hitachi Power Africa has been awarded the boiler contract worth R18.5 billion and Alstom S&E has been awarded the turbine island works contract valued at R13 billion."

Financial institution support
According to BankTrack, the following institutions are involved in supporting the Kusile Power Station:

Multilateral development banks
 * African Development Bank - $500 million corporate loan, November 2008

Banks
 * Bank of America - advisory service, October 2010
 * Bank of Tokyo Misubishi UFJ - 705 million euro syndicated loan, December 2009
 * Barclays - advisory service, October 2010
 * BNP Pribas - corporate loan as part of 1,185 million euro syndicated loan
 * Credit Agricole - corporate loan as part of 1,185 million euro syndicated loan
 * Credit Mutuel-CIC - corporate loan as part of 1,185 million euro syndicated loan
 * Credit Suisse Group - helping with the sale of a stake
 * Deutsche Bank - 705 million euro syndicated loan, December 2009
 * FirstRand Bank Ltd - 705 million euro syndicated loan, December 2009
 * HSBC Group - 705 million euro syndicated loan, December 2009
 * JPMorgan Chase - advisory services
 * KfW IPEX-Bank - 705 million euro syndicated loan, December 2009
 * Natixis - corporate loan as part of 1,185 million euro syndicated loan
 * Nedbank Group - 705 million euro syndicated loan, December 2009
 * Rand Merchand Bank - 705 million euro syndicated loan, December 2009
 * Societe Generale - corporate loan as part of 1,185 million euro syndicated loan
 * Standard Bank - 705 million euro syndicated loan, December 2009

Export Credit Agencies
 * COFACE - corporate loan as part of 1,185 million euro syndicated loan
 * Euler Hermes Kreditversicherungs-AG (Hermes) - 705 million euro syndicated loan, December 2009
 * Export-Import Bank of the United States (Ex-Im Bank) - $805 million, April 2011

Investment Funds
 * Public Investment Corporation (PIC) - R 9 billion (US $1.2), May 2010

U.S. Export-Import Bank financing
As of October 2010, the Export-Import Bank of the United States (Ex-Im Bank) is currently preparing for decisions regarding Ex-Im Bank financing of what would be two of the world's largest coal-fired power plants, Kusile and Sasan Ultra Mega Power Project (proposed in India). August 11, 2010, marked the comment deadline for the Environmental Impact Assessment on the Kusile project. US citizens submitted nearly 7,500 public comments in opposition to the US government's contribution to the project and its environmental impacts, including annually emitting more than 150% of the annual carbon dioxide emissions from projects supported by the Ex-Im Bank in 2009. In 2004, the Ex-Im Bank adopted "global environmental standards," and in 2009 the bank adopted a carbon policy. Yet according to a recently released Government Accountability Office (GAO) report, more than 95% of Ex-Im's energy portfolio is based on fossil fuels, and in 2009 Ex-Im Bank financing for renewable energy was less than .5% of the agency's total financing. The US Ex-Im Bank Board is expected to take up a due diligence vote on Kusile by the end of 2010.

Eskom Plant Gets Approval
On April, 14, 2011 Black & Veatch Corp. won preliminary approval for $805.6 million in financing from the U.S. Export-Import Bank for the Kusile plant in South Africa's Mpumalanga Province, which will include six units and have a total capacity of 4,800 megawatts.

On May 31, 2011, Eskom announced that the Export-Import Bank of the United States (Ex-Im Bank) had given its initial approval for an $805 million (R5.78 billion) loan to help Eskom build the plant. The final vote on the Ex-Im Bank’s loan for Kusile is expected in approximately 35 days after a mandatory Congressional notification period.

The South African government has indicated that it is not in a position to contribute any further funds to its Kusile and Medupi Power Station projects. In the case of Medupi, additional financing is coming from the World Bank.

The plant is expected to emit an estimated 36.8 million tonnes of CO2-equivalent per year once it is completed, the 4800 megawatt Kusile coal power plant is forecast to increase South Africa’s greenhouse gas emissions – already the biggest in Africa – by nearly 10%. In addition, it’s projected to consume more than a billion gallons of water annually and release various health-threatening pollutants into the air. South Africa has extensive coal reserves and is generating more than 90% of its electricity supply through it.

Greenpeace report
The 2011 report, "The True Cost of Coal: The monstrous price of South Africa's coal addiction" by Greenpeace Africa and the University of Pretoria’s Business Enterprises unit calculates the full costs of the Kusile plant, from climate change to water use, and the impact on health and the environment. It was estimated that the damage caused by Kusile will cost South Africa between R31.2 billion and R60.6 billion a year, and that just 30% of Kusile’s externality cost would be able to generate five times the coal station’s proposed power with renewable energy. Roughly 70% of the total cost was water-related.

Opposition
In November 2011, Greenpeace activists chained themselves to a gate and some climbed a crane to protest the Kusile power station and South Africa's dependence on coal, a few weeks before the country will host a global conference on climate change. Authorities arrested nine people, who were ordered to return to court Nov. 21 on charges of trespassing and malicious damage to property.

Related SourceWatch Articles

 * South Africa and coal
 * Nuclear power in South Africa
 * Medupi Power Station