MARCH AGAINST GOVERNMENTS MULTIBILLION RAND DEALS WITH INDEPENDENT POWER

PRODUCERS (IPPs)

The Coal Transportation Forum has organised coal trucking companies, suppliers, mines and all affected
entities to hold a march to the Union Building that will bring the countrys capital, Pretoria to a standstill. The
protest action on Wednesday 1st March 2017, will be against the recent commitment by the countrys
authorities to procure billions of rand in renewable energy, a decision which will bring crippling job losses in
many sectors.

In his recent State Of The Nation Address, President Jacob Zuma announced that Eskom will sign the power
purchase agreements for the renewable IPP that have been procured by the department of energy. This
happens at a time when the electricity consumption is showing a decline of 1% for 2016/2017, and Eskom has
announced a surplus of 5600MW including operating reserve of 2000MW. As a result of this electricity surplus,
Eskom is procuring a kilowatt hour of electricity from the IPPs at 214 cents for what they can produce at 32
cents by using abundant and cheap coal. The kilowatt hour that is procured for 214 cents is sold for 86 cents
by Eskom to the consumer. This has cost the economy R9 billion in 2016. It has also resulted in the reduced
coal consumption by 3 million tons of coal. For as long as there is a surplus of electricity, the cost to the
economy will be sustained at R9 billion rand per annum until 2021.

The IPPs will carry a contingent liability of R700 billion by 2020. This means government is providing
guarantees to the IPPs to destroy jobs in the mining sector. The demand for coal used to generate electricity
will reduce by up to 10 million tons per year in 2021.

We believe the following are the unintended consequences of the IPP programme:

- Eskom will be forced to shut down at least Komati, Hendrina, Arnot, Camden and Grootvlei Power
Stations
- Up to 30 000 permanent jobs will be lost by Eskom and its associated suppliers
- Coal mines will close and EMalahleni will be reduced to a ghost town.
- Coal transporters and suppliers will be forced to retrench workers.
- Many towns in Limpopo and Mpumalanga that are reliant on coal mining as the pillar of their
economies will become ghost towns.
The Coal Transportation Forum wants the government to protect the jobs in the mining and related industries.
The IPP programme must be slowed down to reflect the current electricity surplus and the fact that the
electricity demand is declining. Government has to own up to the unintended consequences of the renewable
IPP programme. We also believe Eskom is trading recklessly by signing IPPs when they are fully aware they
will be downgraded by rating agencies if they continue to sign IPPs at this current pace and costs and NERSA
is unreasonable to give Eskom a negative tariff increase.

For the purpose of Wednesdays march, trucks will travel from parts of Mpumalanga and Gauteng
converging in Marabastad in Pretoria. Marchers will then make way the Union Buildings. Here we expect to
hand over a memorandum of grievances to the President of the Republic of South Africa. We apologize in
advance for the inconvenience that will be caused to the citizens of Tshwane as well as anyone who will get
caught up in the protest. Ours is not a political statement. We simply cannot afford to sit back and watch while
thousands of workers lose their jobs and livelihoods getting destroyed.

Representative / Spokesperson for Coal Transportation Forum

Mary Phadi (076) 516 8757