Radebe: 'Eskom's financial losses can't be blamed on IPPs'
Energy Minister Jeff Radebe vouched for the renewable energy independent power producers project, saying that the awarding of contracts is fair, open and transparent.
At a briefing in Pretoria on Sunday, Radebe vouched for the renewable energy independent power producers project, saying that the awarding of contracts is fair, open and transparent.
This is amid talks of the possible privatisation of Eskom following President Cyril Ramaphosa's announcement to unbundle the utility.
Radebe says that Eskom is not borrowing money for buying the electricity generated by independent power producers or for funding the construction of the IPPs.
"The cost of buying from the IPPs is included as an expenditure before the calculation of the big term number. In other words, after all operational costs have been paid, including the electricity from IPPs but before the payment of interest."
He says the financial losses at Eskom cannot be attributed to the introduction of the renewable energy progamme.
"Eskom's financial problems are mostly related to the cost increases including the increase of interest during construction associated with delay of the new build projects, Medupi, Khusile and Ingula."
Radebe says that since 2013, Eskom has not incurred a cent in buying electricity from the independent power producers, which they've not been able to recover through tariff allowances.