Ramaphosa said load shedding is being implemented as a last resort to avoid a total blackout.
- There are no easy solutions to cargo shedding, and steps include managing Eskom’s debt, overcoming skills shortages and improving municipal revenue collection, Ramaphosa says.
- The president said proposals to address Eskom’s debt burden are under consideration and a solution will be found.
- Ramaphosa said load shedding is being implemented as a last resort to avoid a total blackout.
Load shedding will be a possibility for “some time,” President Cyril Ramaphosa said.
The president responded to questions from MPs on Thursday. Responding to a question from DA leader John Steenhuisen about the government’s plans to tackle the energy crisis, Ramaphosa noted that it is “inevitable” as it is being implemented to prevent a total grid collapse or blackout. to prevent.
But the government is working to address the “complex problem”.
One of the solutions is the restructuring of Eskom into three entities – generation, transmission and distribution – which are an important part of restructuring the electricity sector as a whole to allow new players into the generation space. Having more generators – including municipalities and independent power generators – will reduce the risk of one entity having the sole monopoly on energy generation.
Other measures to introduce new generation entrants include the lifting of the license exemption for 100 MW generating facilities, as well as efforts to procure new backup power and the launch of subsequent bidding rounds of the Renewable Energy Independent Power Producer Procurement Programme.
There are many challenges to a safe and stable electricity supply, Ramaphosa said.
These include managing Eskom’s debt of approximately R400 billion; overcoming the skills shortage in the country – when it comes to electricity supply; steadily improve municipal revenue collection; improving Eskom’s maintenance capabilities; and eradicating all forms of corruption and crime in the energy company. Ramaphosa noted reports of sabotage in which Eskom’s pylons were cut.
Ramaphosa addressed concerns about Eskom’s leadership – its executive management and board of directors – and said leadership is an issue that is constantly being considered. Ramaphosa said Eskom’s management is working with a number of leading companies to maintain factories, which are old and often break down. Ramaphosa said he does not believe leaders are deliberately waking up to tear down the power plants. “This [power stations] break because they are old.”
The Black Business Council recently called for the resignation of CEO André de Ruyter and the board of Eskom. But De Ruyter has indicated that he does not intend to resign of his own accord.
“…I have been appointed by the board of Eskom. The board in turn is appointed by the minister of public enterprises. If they have lost confidence in me, it is up to them to cut ties with me and replace me requests to leave,” De Earlier said Ruyter.
Eskom debt solution
Ramaphosa also responded to questions about the debt burden of Eskom, the largest of all state-owned companies in the country.
“We are now in debt. Eskom is too big to fail. A failing Eskom would be catastrophic for our economy and the lives of our people,” Ramaphosa said. He added that Eskom is a “collective problem” that needs to be solved. “It doesn’t help us to sit and do nothing,” he said.
Non-governmental entities — such as corporations, unions and community organizations — have discussed how best to manage Eskom’s debts, the president said.
Ramaphosa told the National Assembly he welcomes the number of South Africans trying to find a solution.
“The government has been working with Eskom to find a way to deal with the debt. A number of proposals abound,” he said. This includes proposals to include Eskom’s debt on the sovereign balance sheet, or find a way to sell the debt.
“All these proposals are being looked at and we should be able to find a solution because Eskom is too big to fail,” Ramaphosa said.
Earlier this week, Eskom’s chief financial officer Calib Cassim told the Permanent Commission on Public Accounts that the utility was proposing that the government pay off between R150 billion and R200 billion of its debt. Unions have previously proposed a debt-for-equity swap – pegged to Eskom bonds held by the Government Employees’ Pension Fund (GEPF). However, the GEPF has said it has not been approached about this, Bloomberg previously reported.