Eskom’s need for a bailout was concerning but should not come as a surprise, according to energy expert Ted Blom.
He was commenting after yesterday’s parliamentary briefing.
Since the start of the week, Eskom has been implementing load shedding, which escalated to stage 4 on Tuesday, and went to Stage 3 yesterday.
Blom said he believed that Eskom would need a bailout from the government.
“They will not make it to the end of March, let alone April, from a financial point of view. This is very concerning as operationally, Eskom is falling apart,” he said.
Blom said Eskom did not have a budget and was taking short cuts.
“This is an accident waiting to happen. They will need a bailout of at least R200 billion, if not more. They are burning cash at a rate of knots and R100bn would not be adequate.
“This will not make a dent in Eskom’s profile.”
South Durban Community Environmental Alliance head Desmond D’sa has said the public should not be expected to give Eskom another cent.
“Eskom’s top management needs to be removed. They need people who know how to manage the entity. We cannot expect the man on the street to pay for corruption and mismanagement by the government,” he said.
D’sa called for Energy Minister Jeff Radebe to be fired.
“He has been there for years. He should be relieved of his job.”
The president of the Durban Chamber of Commerce and Industry, Musa Makhunga, said businesses could not afford load shedding.
“It has a severe socio-economic impact across key industry sectors, resulting in a loss of productivity that will inevitably lead to revenue loss across key industry sectors. This can negatively impact jobs and economic growth. This also poses a threat to equipment damage and project delays.”
Jesse Burton of the Energy Research Centre at the University of Cape Town, said Eskom needs to show that it can cut unnecessary costs, otherwise a bail out will just mask the poor choices it continues to make.
“Eskom needs to desperately stop spending money. This means cancelling the construction of mega coal plants Medupi and Kusile – two plants that are over time, over budget, and are still not running properly. And it mean assessing whether spending money on old, under-maintained coal plants is the best use of limited resources, when South Africa could instead procure new generation capacity more cheaply and quickly. Delivering reliable, affordable energy services needs to be a priority and the government should start a procurement process for new renewable and flexible supply immediately,” Burton said
