Loss-making Eskom warns of funding shortages
1 September 2009
Eskom has announced that its expansion programme for reducing power shortages will suffer a funding deficiency of 80 billion rand (£6.3 billion) after announcing record losses for this year.
According to the company, the South African state-owned electricity company provides 95 per cent of South Africa's electricity and approximately 45 per cent of the entire continent's.
The expansion project would reduce the risk of blackouts, which in January of 2008 crippled South Africa and cut off electricity exports to neighbouring Botswana and Zimbabwe - leading to wider grid failure in Zimbabwe.
Eskom chairman Bobby Godsell is said to have insisted in a recent Johannesburg presentation that stopping or delaying these projects would be "highly undesirable".
He said: "Not only would it reintroduce the possibility of supply failures, it would also curtail real economic activity at a time when the South African economy most urgently needs it."
Nuclear, hydropower and wind projects have been shelved by the company in the past year due to a lack of funds.
Chief economist for Efficient Group Ltd Dawie Roodt told Bloomberg that private sector participation would be imperative to recovery.