Eskom might be "too big to support" - Expert

Bradley Prior

MyBroadband Journalist
Staff member
Super Moderator
Joined
Oct 16, 2018
Messages
3,567
Eskom might be "too big to support" - Expert

While South African President Cyril Ramaphosa says power utility Eskom Holdings SOC Ltd. is considered too big to fail, S&P Global Ratings has a different view: it could be too big to support.

The government’s commitment to provide Eskom 23 billion rand ($1.5 billion) annually for three years is insufficient on its own to improve the company’s liquidity outlook and credit rating, and will act as a constraint on fiscal consolidation, raising the country’s overall debt burden, Engineering News reported, citing S&P Global Ratings Director Ravi Bhatia. [Bloomberg]
 

zeb

Expert Member
Joined
Nov 14, 2005
Messages
2,814
Well now S&P Global Ratings Director Ravi Bhatia, what's the alternative?
How will the lights stay on if Eskom did fail?
 

lsheed_cn

Expert Member
Joined
Sep 14, 2008
Messages
3,076
Well now S&P Global Ratings Director Ravi Bhatia, what's the alternative?
How will the lights stay on if Eskom did fail?
Split up generation and transmission.
Prioritize paying customers.
Stop exporting excess to other countries unless they pay.
Allow muni's and other 3rd parties to implement their own generation.
Some generation - eg Renewables can be in place in low month timeframes.
 

Chris_the_Brit

High Tory
Joined
Mar 6, 2004
Messages
31,428
Well now S&P Global Ratings Director Ravi Bhatia, what's the alternative?
How will the lights stay on if Eskom did fail?
Open the sector up to competition, make it easier for IPPs to connect to the grid...
 

zeb

Expert Member
Joined
Nov 14, 2005
Messages
2,814
A great many municipalities are bancrupt because of corruption. They're struggling with garbage collection, I can't imagine how they'd handle electricity supply.
 

Zoomzoom

Executive Member
Joined
Aug 15, 2014
Messages
5,478
Eskom, where it is the distributor, has not even fully implemented the meagre Free Basic Electricity provision to all households, though it would have a relatively trivial impact on costs, with extensive social benefits.
Can we tell this to the DA who love to slash the free basics as part of their money grubbing ways.
 

Paul_S

Expert Member
Joined
Jun 4, 2006
Messages
4,674
Split up generation and transmission.
Prioritize paying customers.
Stop exporting excess to other countries unless they pay.
Allow muni's and other 3rd parties to implement their own generation.
Some generation - eg Renewables can be in place in low month timeframes.
First step: Retrench at least 30,000 Eskom workers who are not required in order to get expenditure under control.
Eskom is about 66% overstaffed let alone having an over paid work force.
Until expenditure is reduced there is no hope of turning things around not even by splitting Eskom into multiple entities. All you'll end up with is multiple loss making entities or one of the entities making a profit while the other two require constant bail outs.

It's time for government to make some tough labour decisions in order to save the economy but I'm not holding my breath.
 

upup

Executive Member
Joined
Jun 1, 2009
Messages
7,087
Well, the people who put Eskom in this place are still enjoying their loot, and their supporters still support them. Shake my head.
 

upup

Executive Member
Joined
Jun 1, 2009
Messages
7,087
First thing that needs to be done, those diesel contract, get the diesel directly from a the supplier, no middle beauty saloon person.
 

Gordon_R

Honorary Master
Joined
Jul 5, 2009
Messages
13,137
First thing that needs to be done, those diesel contract, get the diesel directly from a the supplier, no middle beauty saloon person.
You obviously do not understand BEE requirements!

/sarcasm
 

thechamp

Honorary Master
Joined
Feb 26, 2011
Messages
29,932
First thing that needs to be done, those diesel contract, get the diesel directly from a the supplier, no middle beauty saloon person.
I agree, we would solve so many peoblems if we were to cut out the middleman, not just at Eskom but everywhere.
 

Gordon_R

Honorary Master
Joined
Jul 5, 2009
Messages
13,137
The bailouts will continue: https://www.fin24.com/Economy/treas...choice-but-to-increase-eskom-funding-20190609
South Africa will increase its financial support for state-owned power utility Eskom, National Treasury Director General Dondo Mogajane said.

“That’s a decision that we’ll have to finalise, but we know we don’t have a choice,” Mogajane said in an interview on the sidelines of a meeting of the Group of 20 finance ministers and central bank governors in Fukuoka, Japan. “It’s an issue of how much, and when.”
 
Top