System Status and Outlook Briefing Jan Oberholzer: Chief Operating Officer Phillip Dukashe: Group Executive Generation Segomoco Scheppers: Group Executive Transmission Megawatt Park: Franklin Auditorium 25 October 2021 Contents 1 Performance Overview - COO 2 Generation Overview – GE: Generation 3 System Outlook: Apr 2021 – Mar 2022 – GE: Transmission Overview and summary of Eskom system year-to- date performance (1/2) We have seen a varied performance by our operating divisions year-to-date, with generally good performance from Transmission and Distribution, however, there remain concerns on the Generation side. The Distribution technical performance is positive in terms of duration and frequency of outages as well as restoration times. On the Transmission side, the severity of a few incidents impacted results, however positive performance was attained with a low number of interruptions and no major incidents year-to-date. We continue to drive for improved Transmission system reliability through our Transmission Sustainability Plan, doing sufficient maintenance and focusing on replacement of older assets. Since February 2021, 1 594 MW new generation capacity was commissioned. On 31 July 2021, Unit 1, the last of six generation units at Medupi was successfully commissioned and handed over to the Generation Division. Kusile Power Station is 50% complete, with three of the six units completed and commissioned. On 29 March 2021, Kusile Unit 3 achieved commercial operation. First ash deposition was achieved at the Camden Power Station Ash Facility on 02 October 2021 and the first coal train was successfully offloaded at the Majuba Power Station coal tippler facility. Koeberg Nuclear Power Station is fully operational and the project to replace the steam generators is on track for 2022. Overview and summary of Eskom system year-to- date performance (2/2) Our coal stock levels are healthy - we have done a lot of preparation to avoid wet coal this coming summer and making good progress in reducing the rand/ton costs of coal. Environmental matters such as emissions and water consumption have shown good improvements year-to-date, but are not yet at the set targets. Safety is well below the tolerance levels, however, regrettably, we have had one employee and one contractor fatality year to date. The Generation side of the business remains a concern, specifically the availability of the coal power stations. YTD Energy Availability Factor (EAF) at 65.3% is not at the targeted level of performance. A key contributor to the low EAF was high levels of planned maintenance over the summer months. That said, the recent high levels of unplanned outages is a concern, but we continue to drive our Reliability Maintenance Recovery Programme. Unfortunately, as at 25 October 2021 increasing breakdowns and low plant availability meant that Eskom was forced to implement load shedding totaling 32 days since 01 April 2021, compared to 47 days for the 2021 financial year ended 31 March 2021. Due to the system constraints, we have used more that the anticipated levels of diesel for our Open Cycle Gas Turbines (OCGTs). We had the unfortunate incident of Unit 4 at the Medupi Power Station. The detailed investigation is under way, and we have started the process to replace it. Nuclear Performance YTD September 2021 1 76.30% UAGS Trip vs. target of 2.55% 1 for Q2 YTD FY22 EAF Actual YTD vs Forced Loss Rate vs. YTD Target of 89.83% YTD Target of 3.55% 98.5% 100% SGR Readiness vs LTO Readiness target plan vs target plan  The low year to date EAF is primarily due to delays experienced in returning Unit 1 to service during the recent refuelling outage – planned for 110 days vs.164 days actual, which includes 35 days due to the early forced shutdown.  Steam Generator Replacement (SGR) - Three of the six SGs (for 1st unit) are on site. The remaining three are nearing manufacturing completion, with installation activities recoverable for the revised schedule. Koeberg Nuclear Power Station Recent noteworthy items related to Koeberg:  Unit 1 tripped after being on line for 75 days on 30 Aug 2021 due to a protection relay failure on a primary pump breaker. The unit was returned to service on 3 Sep 2021.  Unit 2 has been on-line for 344 days (as at 30 Sep 2021) since completing its last refueling outage in October 2020.  The Reactor Pressure Vessel Head arrived at Koeberg on 11 Oct 2021.  Steam Generator Replacement (SGR)  Three SGs are already on site and are being prepared for installation during the Unit 2 Outage starting in Jan 2022.  The remaining three SGs are nearing manufacturing completion and will be delivered to site in time for the next Unit 1 Outage scheduled to start in Sep 2022.  Koeberg Long-Term Operation (LTO)  The LTO activities to enable Koeberg to operate for another 20 years beyond 2024/254 continue as per schedule. The formal application to extend the operating license has been submitted to the National Nuclear Regulator and accepted for further processing. Group Capital Performance YTD 30 September 2021 Execution of Major Plant 1 594 MW YTD Defects Correction vs YTD target of 1 594 MW vs plan (Jan 2021 to Sep 2021) Execution of Emissions Execution of Ash Dam Control Projects Projects  Commercial Operation of new units: On 31 July 2021, Medupi Unit 1, the last of six generation units, was successfully commissioned and handed over to Generation. On 29 March 2021, Kusile Unit 3 achieved commercial operation  Major plant defects correction: At Medupi, boiler plant modifications have been implemented on all six units, except for the long lead time milling modifications and the duct erosion modifications on Unit 6. At Kusile Unit 1, the boiler plant modification outage that commenced in June 2021, was completed.  Execution of emissions control projects: Steady progress is achieved on the projects, however some construction, contractual challenges, including COVID-19 constraints are impacting execution.  Execution of ash dam projects: Significant progress achieved with ashing at Camden and Majuba, however some commercial, construction issues, including inclement weather and COVID-19 constraints are impacting execution.  Other: Tender evaluations for Phase 1 of the Battery Energy Storage Systems (BESS) project is complete. At Majuba the coal tipler was successfully commissioned. Medupi and Kusile major boiler plant defects correction • Eskom is correcting all the major boiler plant defects (i.e., mills, gas air heaters, fabric filters, air and flue gas ducts, and reheaters) at both Medupi and Kusile. • A defect correction program was established in collaboration with the original boiler contractor, to test, develop and implement technical solutions in all Medupi and Kusile units. • Medupi Unit 3 was used as a pilot for the initial implementation of these solutions, which require extended unit outages to execute. Similar solutions were rolled out to all Medupi units and Kusile Unit 1. Effective from 2021/2022, this roll-out will be implemented on the remaining Kusile units, as unit planned outages become available. • Similarly, defect correction on the milling plants are done during planned mill refurbishment outages and as modified spares become available. • Eskom is also developing enhanced boiler plant solutions, independently and in liaison with the boiler contractor and other parties. These modifications will be rolled out during standard planned unit maintenance outages starting in 2022. Interim Results: the availability and reliability of the Medupi new units is steadily improving. Status of GCD New Build Programme (inception to date): Focus is on bringing new capacity online and driving plant defect corrections  Achieved CO on or Target schedule earlier than target Latest Eskom Board Approved Completed Units Target Dates FY 2015 – FY 2022 FY 2022 – FY 2025 Sere Wind Ingula Ingula Medupi Kusile Kusile Medupi Kusile Kusile Farm Unit 4 Unit 2 Unit 5 Unit 1 Unit 2 Unit 1 Unit 4 Unit 6 Mar-17 May-17 Mar-18 May-18 Jan-21  Jul-21  Jan-23 May-24 Mar-15  Jun-16  Aug-16  Apr-17 Aug 17  Oct-20 Jul-21 100 333 333 794 800 800 794 800 800 794 333 333 794 794 794 800 800 Medupi Ingula Ingula Medupi Medupi Medupi Kusile Kusile Unit 6 Unit 1 Unit 3 Unit 4 Unit 3 Unit 2 Unit 3 Unit 5 Jun-15 Jun-19 Dec-19  Mar-21 Dec-23 Aug-15   Jul-17 Jan-17 Jul-18 Aug-16 Jan-17 Nov-17  Jul-19 Nov-19 Mar-21 … 2 400 MW to be 8 596 MW installed since 2015 & installed over the next 4 14 733 MW installed since 2005 …. years Transmission Performance as at end September 2021 96.8% Maintenance SM<1 of 2.01 vs YTD target of 1.75 Completion 0 Major Incidents 10 Interruptions vs YTD target of 1 vs YTD target of 17  System reliability performance: Although there have been a low number of interruptions YTD, System Minute <1 performance has been negatively impacted by one large event involving a transformer failure.  Nil Major Incidents (defined as System Minute loss of >1) have occurred YTD.  High levels of maintenance completion has been sustained  Asset condition risks require increased asset renewal investment going forward for future operational sustainability  Ongoing theft and vandalism has impacted operations creating risks for interruption incidents Distribution Performance as at end September 2021 Electrification SAIDI SAIFI 38 256 36.68 13.00 vs. vs. vs. YTD Target of 34 742 38.00 Tolerance 19.60 Tolerance Planned Maintenance Refurbishment Restoration Time Completed Spent 90.68% R150m 91.5% vs. vs. vs. YTD Target of 93% YTD Target of R230m 90% Target  System performance, measured by SAIDI and SAIFI remains positive and within the desired levels.  Planned Maintenance and Refurbishment execution are below target but have not adversely impacted system reliability. Completion of the planned programs remains a key focus area for the business.  Theft and vandalism of network equipment continues to impact operations and system reliability.  Electricity theft continues to manifest as an operational, financial and public safety risk. Generation Performance as at end September 2021 342 UAGS Trips vs. 196 65.3% YTD target for FY22 Availability vs. 70% target for FY22 23.1% 4612 MW Unplanned load losses vs. 18% target for FY22 Partial load Losses vs. 3969MW target for FY22 9.1% R2,44bn* Planned maintenance vs. Open Cycle gas turbines cost 9.2% YTD target FY22 vs YE projection R4,1bn * Eskom OCGTs only as at 11 Oct 2021 The FY2021 EAF performance was lower overall compared to the FY2020 performance. The FY2022 performance continues to be lower than the aspiration resulting in intermittent load shedding. Generation monthly and YTD performance Contributing factors Percentage (%) OCLF UCLF PCLF EAF • Camden’s ash constraint contribute about 39% to total YTD OCLF of 2.68%. 2 5 4 4 4 2 2 3 4 4 4 3 4 2 4 2 3 2 3 2 • Slips, trips, boiler tube failures, partial and full load 17 18 19 20 19 19 20 18 20 22 20 23 22 21 22 23 losses all contributed to the 25 25 24 26 high UCLF. 7 5 • Generation fleet YTD EAF at 15 7 14 11 14 16 12 11 6 8 10 12 9 65.42% is below the YE target 18 14 7 13 12 of 70%. • During the year, a delicate balance was required to giving the plants opportunity for planned maintenance and the having the plants available to 71 72 65 69 66 65 65 64 64 64 64 67 67 66 63 65 support the system. The ratio 58 57 59 60 of short-term to long-term is about 1:2 Mar’21 Apr’20 Aug’20 Sep’20 Feb’21 FY21 YE Aug’21 Sep’21 Nov’20 Dec’20 FY22 YTD May’20 Apr’21 May’21 Oct’20 Jul’20 Jul’21 Jun’20 Jan’21 Jun’21 The impact of performance at Duvha, Kendal and Tutuka on Generation EAF (%) DV EAF Bud DV EAF Act KD EAF Bud KD EAF Act TT EAF Bud TT EAF Act Gen EAF Act Gx EAF if DV, KD + TT were at 70% EAF % 80 75 74 73 72 70 68 70 69 70 71 67 67 69 65 68 67 67 67 65 65 64 66 66 66 64 61 61 64 61 64 63 61 63 61 63 60 59 59 60 58 55 55 57 56 55 53 52 52 53 52 50 50 50 50 48 79 48 80 48 47 47 47 47 46 46 46 44 73 45 45 44 69 44 65 42 42 42 42 67 64 40 39 63 40 40 40 38 38 58 37 37 36 36 35 35 35 35 35 31 30 31 30 30 29 25 24 23 20 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Key Insights • Kendal and Tutuka’s performance have constantly been below the budget for the review period. • Duvha had a better performance vs the budget in November, December and May, otherwise the EAF performance has been constantly below the budget. • The lower than expected availability of Tutuka, Duvha and Kendal reduced Generation’s EAF by between 5% and 9%, assuming they could perform at the targeted EAF. 14 Coal Fleet Yearly EAF Performance shows that the performance has continually been declining EAF % PCLF % EUF % Capex (R’ Bn) Key Insights • Yearly Coal EAF has 100 been steadily declining 93 93 93 93 93 88 91 90 90 since FY2010 with an 90 87 85 83 improvement in FY2017 80 and FY2018. 80 84 80 • The improvement could 70 76 75 75 partly be related to 72 70 68 67 increased maintenance in 60 61 FY2016 and FY2017. 60 59 • Performance shows a 50 14 13 13 direct relation between 40 12 11 11 EAF and EUF, i.e. the 10 9 10 9 9 10 drop in availability, results 30 8 in higher utilisation of the available plants capacity. 20 12 13 • Recent availability has 10 9 10 10 10 10 6 6 8 8 significantly reduced 5 3 resulting in the need to 0 run the available coal FY2022 YTD FY2011 FY2010 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 plant hard to meet the demand. • The load factor has been • Energy Availability (EAF) Factor for a plant is the percentage of the maximum energy that it can supply to the grid (after factoring for declining with years planned and unplanned shutdowns) • Load Factor (LF) measures how hard the plant is running against its maximum possible output (i.e. when EAF is 100%). • Energy Utilisation Factor (EUF) measures how hard the plant is running when it is available (using the actual EAF). Benchmarking Energy Utilisation Factor (EUF) % - Eskom units typically run much harder than benchmark units Benchmarking EUF % All Coal Sizes 2000 - 2018 67 VGB Units - Current Year (excl. Eskom Units) Energy Utilization Factor (EUF %) 95 85 75 65 55 45 VGB Worst Quartile VGB Median VGB Best Quartile Eskom Worst Quartile Eskom Median Eskom Best Quartile 35 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Calendar years Calendar Years Latest VGB benchmarking data - 2018 Long Term maintenance decreased from mid May 2021 to end June 2021, which typical for the winter period, and has increased since the beginning of August 2021 Short term YTD PCLF: 3.09% Long term YTD PCLF: 6.05% Overview The maintenance is still showing seasonal trend which is typical for planned outages, reducing in the winter and increasing in the summer period. However short term is fluctuating depending on the space available in the system. Partial Load Losses, Full Load Losses, trips, slips, major incidents and the Camden Ash Dam constraints have been the major contributors to the increase in total unplanned losses Build-up of Unplanned Losses for FY2022 September YTD from major contributors 30 Other Losses ME OCLF 382MW 359MW 475MW 11612MW 4605MW 10395MW 0.8 25 1.1 0.9 20 10.2 1640MW 15 1288MW 3.7 25.8 0.8 23.1 10 2.9 2.9 2012MW 850MW 2.5 0.4 5 4.5 1.9 3.1 1.3 0 FLLs BTLs Trips Outage Slip PLLs Total UCLF Camden Coal OCLF Other Total Ash OCLF Unplanned Constraints Key insights  Plant performance is highly unpredictable with multiple failures experienced continuously  Current UCLF of ~23% is unsustainable for the business resulting in load shedding incidents  Partial Load Losses (PLLs) continues to be the biggest contributor to UCLF for FY2022  Resolving the issues sustainably requires extensive maintenance Outages and implementation of refurbishment projects Conclusion - COO • We have seen strong performance from our Transmission and Distribution businesses, • We continue to invest in our networks to replace old assets in order to sustain network reliability, Summary of Eskom system performance • Koeberg Nuclear Power Station is fully operational and provides a reliably supply of electricity to the network, • Our Generation business remains a concern - mainly due to its age and a legacy of poor maintenance, • We continue to drive our planned maintenance programme, with a very specific focus on the effectiveness of our outages, • Our Group Capital division is making steady progress on the new build programme, with all the Medupi units and 3 of the Kusile units now in commercial operation, • The process to address the design defects of the Medupi and Kusile are progressing well and from next year we will implement additional enhancements, • We are doing out utmost to limit load shedding, but not at the cost of doing effective planned maintenance, • Additional capacity (4 000 MW to 6 000 MW) required, • Again, we appeal to customers to continue to use electricity sparingly. Something Important to Note Contents 1 Performance Overview - COO 2 Generation Overview – GE: Generation 3 System Outlook: Apr 2021 – Mar 2022 – GE: Transmission FY2022 Generation System Performance FY2021 FY2022 EAF, % Official System EAF -5,2 -6,4 • Current financial year Sep 2021 MTD is 63.3% 71,9 -1,4 which is more than one percentage point lower 70,6 0,0 -2,6 (actual: 65.1%) compared to last financial year 68,7 -1,8 -1,0 67,9 September actual. 66,7 67,3 66,2 66,3 64,7 65,1 65,3 63,7 64,2 63,3 • Current financial year YTD Sep 2021 is 65.3% which is more than two percentage points (actual: 67.9%) lower compared to last financial year YTD figures. Apr May Jun Jul Aug Sep YTD • FY2022 YE EAF target is 70% versus 65.3% YTD Eskom OCGTs, GWh +56% Eskom OCGTs 772 • MTD: Sep 2021 is 41 GWh (2.4% load factor) up to the end Sep 2021 compared to 68 GWh +252% actual for Sep 2020. 495 +658% • YTD: Sep 2021 is at 772 GWh compared to 495 GWh YTD actuals for last financial year. +905% -44% -59% 216 211 -39% • FY2022 YE provision is 211 GWh (1% load 164 160 145 factor) versus 772 GWh YTD (7.3% load factor). 92 60 66 68 28 41 14 Apr May Jun Jul Aug Sep YTD Station Contribution to Total UCLF F2022 30 September YTD – 23.14% Average MW loss YTD 30 September 2021 2,200 2144 Fleet Impact Others 2,000 11% Boiler Electrical 46% 22% 1,800 3% 1578 Auxiliary System 1,600 4% 1,400 Ash Plant 5% 92% 1,200 1092 1,000 919 8% Feed Water 769 14% 800 703 665 616 600 Turbine 424 412 9% 400 307 240 198 Generator 162 200 119 13% 10% 24 20 0 Mills Draught Plant TT KD DV MD MJ KR ML AR HD MT KB KS LT CD GV PK KM Key Insights • Tutuka, Kendal and Duvha contributed about 46% of the total UCLF YTD. • Boiler, Turbine, Draught and Milling Plants were the main contributors 60% contribution) for the period of 30 September FY2022 YTD. Station Contribution to Total OCLF F2022 30 September YTD – 2.71% Average MW loss YTD 30 September 2021 500 493 Fleet Impact 450 Other OCLF 40% 30% 400 Camden ash 350 39% 300 96% 250 201 200 162 150 128 97 100 84 50 21 16 31% 14 2 0 CD ML KR MD MJ MT PK TT HD Other Coal Related Key Insights • Camden contributed about 40% of the total OCLF YTD. • Coal related losses at 0.85% contributed about 31% of the total OCLF YTD, with Matla at 195MW (51%) and Kriel at 148MW (39%) being the biggest contributors. • Camden Ash constraints at 1.06% contributed about 39% of the total OCLF YTD The Generation Improvement Plan focus areas and initiatives 1 EAF improvement 2 Leadership and culture 3 Skills and resourcing  Power Station Improvement  Clarify expectations at a senior  Reaffirm ‘Specialist Group’ Plans level and drive accountability function  9-Point plan and MTTR actions  Drive technical focus  Augment specialised skills  Driving Partial Load Losses  Improve housekeeping  Drive capability building down  Power Station visits ‒ Project R and PCM training  Accelerate resolution of New  Active risk management ‒ Engineering Practitioners Build defects training  Power station assessment drive  Outage preparation / readiness ‒ OEM training improvement  Enhance knowledge at a senior level  Develop resourcing strategies –  Coal Quality improvement drive technical roles  Drive Gx communication plan  Recover procurement  Fill Vacancies performance  Restore pride in employees  Establish Gx Turnaround Plan Steering committee Reliability Maintenance Recovery (RMR) Programme Status at 30 September 2021 110 100 17 90 80 18 70 60 9 50 22 40 84 30 10 20 10 25 0 FY2021 Base Plan Completed Executing Deferred Within FY2022 Deferred to FY2023 Remaining Additional Outages  Status of Reliability Maintenance FY2022:  A total of 84 outages are scheduled from 1 April 2021 to 31 March 2022  As at 30 September 2021, of the 84 outages planned for FY2022, 18 have been completed, 9 are in execution, 25 are remaining and 22 have been deferred within the financial year while a further 10 outages have been deferred to FY2023.  An additional 17 opportunity maintenance outages have been executed.  The current plant performance is poor, with little confidence in any predictability in performance. The biggest opportunity to fix the plant is during Outages – hence the importance of the RMR Programme  The main work impacting plant reliability and predictability is carried our during Mini-Overhauls and General Overhauls. There are on average 20 MGO’s and GO’s p.a. for coal fired power stations  There will be a 3 year lag period to have completed MGO’s or GO’s on the coal fleet units Reliability Maintenance Recovery Interventions Strategy (Analogy) OFF-LINE: Mini General Overhaul (60 ONLINE: Continuous OFF-LINE Inspections: months); General Overhaul (120 months Major vehicle service • Minor maintenance activities focused • Thorough inspections should be done on performance sustainability like oil on your vehicle in preparation of • Intrusive well planned long duration top-ups, tire inspections, windscreens major services. philosophy maintenance intended to etc. This is done frequently to ensure • Such inspections allow one to have a restore the vehicle to it’s original design safety and road worthiness while still comprehensive understanding of what performance allowing to drive your vehicle safely. work is required on your vehicle, what • Much work during an MGO/GO is on • Such on-line work allows one to plan, critical spares parts need to be specialized equipment and linked to observe car condition and budget for available and the level of the skill that safety and specific technical criteria (don’t any potential intrusive work that may be needs to be secured to carry out very use Toyota spares in Mercedes vehicle) required. critical activities. • Philosophy work should be aimed at • This work is done on a continuous • Such inspections offer the owner the predictable vehicle performance till next basis to track the condition of your time to shop around, negotiate best major service vehicle and look for any possible products at the best prices, best • Intensive work on critical components of anomalies: what you find during on- people, timing and durations for the the vehicle requiring specialized skill and original manufactured equipment that line maintenance is used for future major service. require a long lead time to secure. maintenance interventions and • Such outages have 24 month planning budgetary provisions. window to scope and plan • Timely budget provision and release of funds is key to outage success 20 & 40 60 & 120 Months Months Tech Plan Projects OFF-LINE: Opportunity Maintenance • Projects aimed at plant performance improvement (environmental &Technical) are carried out during MGO’s and GO’s. • This requires planning and excellent (major service) execution but should take the shortest Continuous improvement to • These projects also address obsolete possible time to allow you to get back on feedback into all equipment upgrades and end of life the track. Maintenance Strategies components that require full replacement. • Work carried out during opportunity aimed at maintenance • Such projects either improve the vehicle maintenance is swift and deals with fixing effectiveness and performance (against design) or extend immediate performance issues. Tire efficiencies (quality, cost & the life span of the vehicle. changes, wheel alignment, replacing of duration) • Such projects have a long lead planning windscreen, inspecting for any possible 27 window pending performance issues. Key requirements to execute a successful Unit Outage Outage Planning Outage Preparation Outage Close-Out • User Requirements • Scope Freeze achieved (T-6) • Outage incident defined • Quality Control Plans in place investigations finalised and • High Level Scope of • Spares Ordering (T-6) & Delivery actioned Work defined (T-3) • Finalised contracts and • Budget Available • Initiated (T-6) & Concluded claims (Financial close out) • Long Lead Spares Contracts (T-3) • Formal Post-Outage Review ordered • Integrated Outage Execution & Lesson’s Learnt Session • Standard work orders Schedule completed in SAP • Work orders released in SAP T-24 – T-18 T-9 to T-7 T-6 to T-1 Outage Post Outage months months months Execution Reviews **24 months to breaker open Continuous Review of Outage Readiness Indicator Outage Scoping Outage Execution • Active management of Outage Scope, • Defined Outage Scope of Work Plan, Cost & Quality • Scope Challenges held and scope • Outage Risk Management & Mitigation optimised • Outage Resource Management • Fully developed Resourcing Plan • Coordinate Recommissioning activities • High Level Integrated Outage Schedule • Handover Plant & Outage • Full Funding secured Documentation Management • Actively Monitoring Outage Readiness (ORI) • Work orders added or removed in SAP Generation is starting to see an improvement in the Outage performance indicators Outage Readiness Indicator trends Due Date Performance trends 90,0% 90,0% 80% 80% 80% 80% 80,0% 80,0% 75% 75% 70,0% 73,1% 70,0% 70,8% 60,0% 60,0% 61,0% 50,0% 50,0% 50,0% 42,9% 40,0% 40,0% 30,0% 30,0% 22,2% 20,0% 20,0% 10,0% 10,0% 0,0% 0,0% Jan - Mar 21 Apr - Jun 21 Jul - Aug 21 Jan - Mar 21 Apr - Jun 21 Jul - 16 Sep 21 ORI Gx Target DDP Gx Target Outage Duration Reduction trends Post-outage UCLF trends 10,0% 25,0% 9% 22,3% 22,0% 9,0% 8,0% 20,0% 7,0% 6% 6% 6,0% 15,0% 16% 15% 15% 12,9% 5,0% 4,0% 10,0% 3,0% 2,0% 1,6% 5,0% 1,3% 0,8% 1,0% 0,0% 0,0% Jan - Mar 21 Apr - Jun 21 Jul - 16 Sep 21 Jan - Mar 21 Apr - Jun 21 Jul - Aug 21 ODR Gx Target PO-UCLF Gx Tolerance Medupi U4: High level overview of the generator Understanding the Generator and purging process • Steam from the boilers turns the turbine. The turbine is connected to the generator which converts rotational energy to electrical energy • Hydrogen is used as cooling agent in the generator, circulated in the casing to cool the current carrying components, - During filling and re-gassing of the generator, CO2 is required to purge the generator of H2 - CO2 is used because it will not react with the hydrogen. • When degassing the generator for shutdown, hydrogen is first displaced by CO2 and then the CO2 is purged by air. This way no explosive mixture of hydrogen and oxygen can occur. Medupi U4: Background to the incident  Medupi Unit 4 was on outage for mill repairs and scheduled  Based on analysis and preliminary as follows: investigations, it appears air was introduced - Actual Start Date : 06 Aug 2021 into the generator at a point where hydrogen - Planned End Date : 15 Aug 2021 was still present, creating an explosive mixture  There was additional scope requested to identify and repair  Unit 4 Generator experienced an H2 explosion an external Generator Hydrogen leak. when H2/Air mixture reached spontaneous combustion level, resulting in:  As part of the search for the leak, scaffolding erection - Severe damage to the Generator and underneath the generator was required, hence the Exciter and the Turbo-Generator auxiliaries - Generator had to be purged. extent yet to be confirmed. - Purging involves displacing one gas with another to - Damages to the Fire Systems and Civil prevent a combustible mixture. In this case hydrogen Structures (H2) is purged with CO2 to prevent the hydrogen from - Damages to Fire doors at Unit 4 and 5 mixing with air/oxygen. equipment as well as battery rooms  The Operating Department was tasked with the purging of - 7 employees were treated for shock (no Hydrogen from the Generator prior to the leak search. injuries or fatalities) Medupi U4: Impact and critical next steps to be taken  Detail Major Event Investigation in progress  Extent of plant damage to be established, including opening and inspections of the 4 main turbine cylinders, structural integrity of adjacent plant etc.  Detail scope of work to be compiled for the recovery of the Unit  Full time recovery manager and multi-disciplinary team appointments being finalised  Schedule which will inform Unit 4 return to service date to be compiled (unit is not expected to be returned within the next 12 to 18 months)  Like for like replacement  Opportunity maintenance to be conducted on all other plant areas  Preservation procedure to be activated where necessary  This incident is being used as a case study going forward Kendal U1: Preliminary findings on Main Generator Transformer fire At 03:36, 11 September 2021, Unit 1 Main Recovery Plan Generator Transformer failed and caught fire • Units 2 and Unit 3 cable repaired and both units returned to service (RTS) on 14 September 2021. • The Unit tripped on “GEN Transformer PRD trip” • Unit 1 Recovery Scope of Work (SOW) frozen 14 and “Transformer DIFF” protection & activated October 2021 GEN Transformer BUCHHOLZS GAS Trip • Unit 1 transformer and associated systems work and • The burning oil from the transformer flowed into the cold commissioning scheduled for completion 2 Main Cooling (MCW) ducting, burning cables that December 2021 affected Units 2 and 3. • Unit 1 return to service expected on the 22 December 2021 Preliminary investigation response: • All requested investigation data captured and sent to A&F (Investigation in progress) • Transformer failed on blue phase (fault directly down to earth), root cause of failure under investigation by Eskom Forensic Team • Civil structure damage assessment due to fire concluded & repairs are in progress (estimated completion 15 November 2021) • Lessons learned from preliminary investigation have been shared with other power station personnel Key concluding messages • Generation plant performance is still unreliable and unpredictable • Improvement initiatives are being driven hard to get to acceptable levels • Leadership effectiveness is at the core of our ability to turn performance around • To ensure system stability and to meet demand a minimum 4000 MW of additional generating capacity is critical: - This will ensure the space for Generation to continue with the planned reliability maintenance and refurbishment programme, and - That the operational recovery is timeously funded and resourced to enable maximum readiness to execute successfully Contents 1 Performance Overview - COO 2 Generation Overview – GE: Generation 3 System Outlook: Apr 2021 – Mar 2022 GE: Transmission System Outlook - context  The majority of the coal power stations are operating past the midway of their operational life, resulting in high levels of breakdowns.  The drive to implement the reliability maintenance and refurbishment projects in order to address the unreliability is under way to get the plant performance back to acceptable levels.  The public is therefore cautioned to expect an increased risk of loadshedding while the Reliability Maintenance program is being implemented. System Performance - Winter 2021 Winter UCLF+OCLF Frequency (01-Apr-2021 to 31-Aug-2021) Thu 01-Apr-2021 to Tue 31-Aug-2021 Base Plan Assumption Base Plan + 1000MW Risk Base Plan + 2000MW Risk 30% 100 90 25% 24,1% 80 20,9% 70 20% 17,8% 60 14,4% 15% 50 40 9,7% 10% 8,2% 30 20 5% 2,7% 1,7% 10 0,0% 0,2% 0,2% 0% 0 6,000 to 7,000 7,000 to 8,000 8,000 to 9,000 9,000 to 10,000 10,000 to 11,000 11,000 to 12,000 12,000 to 13,000 13,000 to 14,000 14,000 to 15,000 15,000 to 16,000 16,000 to 17,000 Key Insights Potential contributing factors • Unplanned unavailability > 11GW for ~72% of the time during • Shortage of generation capacity; the winter period • Increased unplanned unavailability; • Loadshedding occurs when: • Increased planned maintenance; • High demand periods coincide with high unplanned unavailability • High unplanned unavailability for a prolonged period of time depletes • The need to conserve and replenish depleted emergency generation reserves emergency resources; • Total of 21 days of Loadshedding between 1 Apr to 31 Aug • Poor coal quality and compromised emissions performance. 2021 compared to 12 days of Loadshedding the previous year. • Total of 11 days of Loadshedding since 1 Sept 2021 Summary of the Summer Plan After the failure of Medupi Unit 4, the Capacity Plan was revisited and minor changes were made to optimize the plan. No outages were cancelled. The Medupi 4 failure continues to have significant impact on Generation’s UCLF allowance. All feasible reliability maintenance required in the 12-month planning period has been accommodated in the plan. This has resulted in a “full” plan with little room to move, extend or add outages. This outage plan was stress tested with 3 scenarios by the System Operator to estimate the OCGT usage and level of load shedding. For the most part the System Operator will need to source operating reserves from Demand Response (DR) products as well as from emergency reserve sources such as Interruptible Load Shedding (ILS) and OCGTs. The Plan requires OCGT usage over weekdays, and low diesel usage on some weekends. The failure of Medupi 4 has increased the dependency on diesel generation to manage the power system. System Operator Capacity Outlook for the next 18 Months (Base Case) System Operator Capacity Outlook (Base Case) MW Available Capacity (Excl Gas) Gas Reserve Requirement Planned Outages Unplanned Provision Peak Residual Forecast Installed Capacity 51000 49000 47000 Winter UCLF 45000 11 000 MW Summer UCLF Summer UCLF 43000 12 000 MW 12 000 MW 41000 39000 37000 35000 PCLF Operating Reserve 33000 31000 29000 27000 Gas 25000 23000 Available Capacity (Excl Gas) 21000 19000 Oct 2021 Jun 2022 Oct 2022 Nov 2022 Dec 2021 Jan 2022 Apr 2022 Jul 2022 Jan 2023 Apr 2023 Sep 2021 Feb 2022 Mar 2022 Sep 2022 Dec 2022 Feb 2023 Mar 2023 Aug 2022 Nov 2021 May 2022 Month 12-month outlook to 31 August 2022 Unplanned Better Base case Base case + Base case + Worse unavailability than plan 1000 MW 2000 MW than plan Summer 2021/22 % of time spent in each 50.4% 19.3% 13.0% 9.8% 7.5% scenario last summer Number of LS days 1 day 40 days 94 days Highest stage of LS Stage 1 Stage 2 Stage 3 OCGT costs R 2.5bn R 6.7bn R 13.5bn Winter 2022 Number of LS days 0 days 3 days 65 days Highest stage of LS N/A Stage 1 Stage 2 OCGT costs R 0.8bn R 1.8bn R 3.5bn Dramatic increase in load shedding days and OCGT cost for only 1 000 MW change in UCLF + OCLF History has shown that it is not possible to use more than about R 1.2bn of diesel in a month due to the physical limitations of moving the diesel to the OCGT stations. Where the Plan shows a diesel usage greater than this, additional stages of load shedding should be expected Summer: 1 September 2021 – 31 March 2022. UCLF+OCLF: 12 000 MW – 14 000 MW Winter: 1 April 2022 – 31 August 2022. UCLF+OCLF: 11 000 MW – 13 000 MW Thank You