South Africa: No Plans to Privatise Eskom, Says Mabuza

Deputy President David Mabuza has assured Parliamentarians that there are no plans to privatise the national power utility, Eskom.

“Government’s policy options and positions have not reached the point where privatisation is seen as an answer to providing better solutions to the current problems that are facing Eskom,” he said.

The Deputy President was responding to questions for oral reply in the National Assembly on Thursday.

Questions posed to the Deputy President by members of political parties represented in Parliament covered issues on Eskom, measures underway to curb illegal mining activities and the outcomes of the recent Communal Land Summit.

He said government is working around the clock to make Eskom a more efficient and effective energy generation and transmission public entity with the necessary capabilities to ensure the security and consistency of energy supply, in the interest of the economy and human development.

Instead, the Deputy President said the utility, which continues to battle capacity constraints, is currently in an advanced stage of the process of unbundling, which will result in the transformation of the electricity sector.

“It would be inaccurate to characterise the current organisational transformation happening within Eskom as privatisation or implied intention to facilitate it.”

Meanwhile, he said government does empathise with citizens as the country continues to face load shedding due to breakdowns of an ageing fleet and power plants.

He said the State was focusing on improving maintenance and repairs to ensure increased energy availability.

However, he assured Members of Parliament that plant maintenance and performance have nothing to do with privatisation or public ownership of the utility.

Eskom is currently undergoing the unbundling or legal separation into three subsidiary businesses namely generation, transmission and distribution.

According to the Deputy President, this exercise is designed to enable Eskom to manage and focus on improving efficiency, create greater transparency around performance and protection against corruption to realise the potential of an independent transmission system and market operator.

He also assured Parliamentarians that Eskom Holdings would have complete ownership of the new transmission entity.

“Its primary responsibilities will include acting as an independent broker in the electricity market and fostering capital investment within the industry and catalysing energy efficiency and costs.”

In the meantime, he said the country should continue to focus on getting Eskom back to its optimal performance, by ensuring that the entity has sound governance structures in place and required skills levels at all power plant levels.

He announced that the utility is on track to split its generation and distribution businesses by the end of 2022, as outlined by President Cyril Ramaphosa in the National Energy Plan.

“This will also fulfil the needs of the National Energy Plan to drive the economy, stimulate industrialisation efforts and ensure the security of electricity supply to housing. Therefore, privatising Eskom is not the answer,” he stressed.

He believes that the country is on track to get Eskom back into optimal performance by ensuring that the entity’s sound governance structure is in place and the required skills are met at the power plant.

“We should take this opportunity to reassure every South African that will continue to work hard to ensure that they have access to reliable electricity so that they can realise their needs and the development of hopes and dreams that we have set ourselves as a nation.”

“Privatisation is not on the cards,” he added.

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