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Eskom expects unbundling of transmission to be done by March

The department said Eskom would initiate the restructuring process by first creating a transmission subsidiary company, which would fall under Eskom’s control.

FILE: The department said Eskom would initiate the restructuring process by first creating a transmission subsidiary company, which would fall under Eskom’s control. Picture: EWN.

CAPE TOWN – Following the announcement of Andre de Ruyter as Eskom’s new CEO this week, the Department of Public Enterprises has on Wednesday given details about plans to unbundle the cash strapped utility.

De Ruyter would take over at Megawatt Park in January, just two months before the expected completion of the unbundling project.

The department said Eskom would initiate the restructuring process by first creating a transmission subsidiary company, which would fall under Eskom’s control.

Acting deputy director general Makgola Makololo said the Eskom of the future would have three subsidiaries: generation, transmission, and distribution.

She said the unbundling of the transmission side of things should be implemented as soon as March.

“We have put ambitious targets in terms of getting through this process, we expect that the functional unbundling should be completed at the next financial year, which is March 2020,” Makololo said.

She's told MPs that restructuring the power utility will support economic growth and further investment in the energy sector.

“In terms of the restructuring process, we anticipate that this will drive further transparency in terms of operational costs and support economic growth in the country because we will have downward pressure in terms of prices and we will have further investment in the sector,” she said.

At the same time, Public Enterprises Minister Pravin Gordhan said state capture had a major impact on SOEs like Eskom, which was in line for major restructuring.

Gordhan said South Africa must clean up its act quickly and make quick decisions on what needed to be done to SOEs like Eskom or the country would begin to fall in global rankings.

He said as part of this, the country must go after those implicated in state capture and the sooner they are sent to jail the better.

“The key deterrent is going to be when the first of these sorts of people who’ve already stolen R1 billion or more from Eskom in one form or another are actually in court and in orange uniforms. So, the soon prosecutions occur, that’s the greatest deterrent.”

On the unbundling of Eskom, Gordhan said the restructuring process would take time.

“It will take place over time and as these changes happen, we’ll have to start working with local communities in particular where power station are.”

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