Ramaphosa backs R131bn financing offer for just energy transition

President Cyril Ramaphosa speaking during his parliamentary Q&A on Thursday made his strong stand in favour of partial privatisation of electricity generation, constantly identifying Eskom as a monopoly that is a danger for the country.

He said on the state-owned power utility’s R401-billion debt: “We are all agreed Eskom is just too big to fail. It would be catastrophic… Eskom is our collective problem that we have to solve,”

To reduce the risk of Eskom’s power generation and transmission monopoly Renewable energy projects and allowing municipalities to generate power alongside independent producers were all measures, according to the president.

“The restructuring of Eskom will transform the sector and will enable greater competition and investment in new generation capacity.”

The opposition seemed muted on president’s pitch on new sectors and new job opportunities that would come with the just transition from coal. 

Backing for South Africa’s just transition was resolved at the Glasgow COP26 UN Climate Change Conference, when the US, United Kingdom, Germany, France and the European Union offered $8.5-billion in grants and concessional loans over the next three to five years.

“This is an offer from developed countries. This is not a deal. Negotiations will now take place at a technical level to appreciate if these offers are compatible with South Africa’s financial requirements, said Gordhan. “Once financing is secured, this will include repurposing power stations, retraining workers and mitigating the impact on communities.”

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