Eskom death spiral of debt continues

Eskom “urgently” needs to borrow R10 billion to pay for a clean energy project, or face penalties on its World Bank loan, stated the City Press.

The World Bank loan was used to fund the construction of Medupi and Kusile, power stations which are well over budget and still not fully operational despite the construction deadline passing.

The City Press stated that the bank lent Eskom R163 billion for the power plants, on condition that Eskom installs batteries at sites around South Africa as part of a clean energy initiative.

The World Bank estimates that the battery project will cost R10 billion, and will consist of 360MW storage batteries on 40 premises throughout the Eastern Cape, Western Cape, Northern Cape and KwaZulu-Natal.

Eskom has not started work on the required battery project, nor does it have the money to pay for the project – and it is expected to ask for a loan of R10 billion.

The report noted that Eskom is already drowning in debt and “has an abysmal record when it comes to completing large construction projects on time and within budget”.

It went on to state that according to sources, the R10 billion Eskom needs was not included in R440 billion debt that was disclosed in the utility’s recent year-end results.

Eskom declined to provide details on the battery project and said it waiting for regulatory approval to proceed.

Eskom is doomed

The latest report on Eskom follows journalist, political scientist, and historian RW Johnson sharing his views on the SOE in a column titled “Our coming train crash”.

Johnson said Eskom is doomed, and money handed over to Eskom is wasted as it will simply be used to pay inflated salaries to many unnecessary workers and finance corrupt deals.

This opinion followed shortly after Eskom revealed its latest financial results in July, stating it made a R20.7-billion loss over the last financial year.

Now read: Huawei plans to take down Samsung in South Africa

Latest news

Partner Content

Show comments

Recommended

Share this article
Eskom death spiral of debt continues