Eskom says it has achieved functional separation of its business into three entities being – generation, transmission and distribution. Eskom says it will focus on first transforming the Transmission business into an independent transmission system and market operator.
Eskom CEO Andre de Ruyter says divisional boards have been put in place, while a new legal entity under the name – National Transmission South Africa has also been registered.
“So we expect to have this Transmission running during the 2022 calendar year. Hopefully, we can bring that forward. But we still require a transmission license, first of all, to be cancelled. The transmission we have now is currently in the hands of Eskom SOC holdings, so that needs to be cancelled and then a new licence needs to be issued. We are in discussion with both the Department of Mineral Resources and Energy and Nersa. We are engaging with our lender to ensure that they are in the loop and on-board,” says De Ruyter.
‘Further losses’
The power utility has also announced its interim financial results in Johannesburg, saying it doesn’t expect to implement rolling blackouts this festive season.
In its latest set, Eskom saw a net profit of R9 billion. This was largely due to a 15.06% tariff increase for 2022, supported by an 8% growth in sales volumes.
However, De Ruyter warns of further losses for the year arguing that the lack of cost-reflective tariffs and unsustainable debt burden also contribute to the anticipated loss.
Eskom says its debt will increase for the year to R416.4 billion from R401.8 billion last year. This, it says, is due to funding postponed from the prior year.
The utility says since March 2021, municipal arrear debt grew by R5.6 billion. It is also calling for more tariff increases which it says can be defended.
De Ruyter says the outlook for load shedding is positive because of lower demand during the festive season.
In terms of its legal separation, Eskom says Transmission will be separated by 31 December 2021 while Generation and Distribution will be separated by 31 December 2022. -Additional reporting by Liabo Setho
