Progress being made on Eskom unbundling costs and funding: Ramokgopa
Electricity and Energy Minister Kgosientsho Ramokgopa says significant progress is being made on defining the costs and funding mechanisms for unbundling Eskom.
Speaking on joint work between his department, the Presidency, and the National Treasury, Ramokgopa noted that policy is being finalised to ensure grid assets are transferred at fair market value.
Ramokgopa was speaking to the SABC NEWS on the sidelines of the Kgalema Motlanthe Foundation’s annual forum in the Drakensberg in KwaZulu-Natal.
A plan has been developed for the handover of control of South Africa’s power grid to an independent Transmission System Operator.
Ramokgopa says the total costs associated with this phase are expected to range between R80 billion and R130 billion.
“Remember, if you want to move the assets, there has to be a fair market value of what that asset BASE looks like on the transmission side, so it’s a function of that examination, or if you like to study, it could range anywhere between R80 billion as a low end, and the high end, I think, can go up to 130 billion.”
Ramokgopa says South Africa is taking a cautious approach to its electricity reform to avoid unintended consequences.
Some observers say the liberalization of the industry in countries like the United Kingdom and Australia failed, resulting in high electricity prices.
“We see what’s happening in France, we see what’s happening in Germany, and we are seeing what’s happening in the UK. There are strong lessons to be drawn from there on what you do in relation to the reform agenda; it mustn’t have the unintended consequences of driving up your cost of electricity.”