Hadebe: 'If we keep running Eskom the same way, we're in trouble'
CEO Phakamani Hadebe says even if it’s granted a 15% increase in the price of electricity, for three years, Eskom would still have an R50 billion debt hole to plug.
CAPE TOWN - Eskom wants consumers to pay more for electricity to help lift it out of its debt spiral.
But CEO Phakamani Hadebe says that even a hefty 15% annual increase for three consecutive years is not a silver bullet.
Hadebe on Monday told the National Energy Regulator of South Africa (Nersa) public hearings, which started in Cape Town, that the government, as the utility’s main stakeholder, will have to assist.
Hadebe says Eskom is on a debt cliff.
And even backed by a government guarantee, it’s struggling to borrow the money it needs.
Even if it’s granted a 15% increase in the price of electricity, for three years, Eskom would still have an R50 billion debt hole to plug.
“If we get the chance and we continue running the business the way we’ve been, we’re going to be in trouble.”
Hadebe says consumers will have to bite the bullet: “South Africans and Eskom, primarily Eskom, should take those painful decisions”
The South African Local Government Association and civil society organisations which made representations to the regulator, strongly objected to the proposal, saying consumers cannot be expected to repeatedly throw money at a company which does not appear to be improving its operations.
At the same time, the Nersa wants answers from Eskom on what action has been taken to root out corruption and mismanagement at the parastatal.
Nersa's Nomfundo Maseti says, “Even with the investigations, there are enforcement agencies that are responsible for those investigations. And some of them are not concluded, and they’ve told us there’s quite a number of those [unresolved investigations].”
(Edited by Zamangwane Shange)