The Portfolio Committee on Public Enterprises received a briefing today from Eskom, a state-owned company. The power utility briefed the Committee on its annual plan and financial results for the year 2013/14.
During the meeting, members of the Committee expressed concerns about the revenue shortfall of R225 billion which the power utility reported. The Committee said what was most worrying about the presentation was that the build programmes (such as Ingula, Kusile and Medupi) needed R300 billion and the company has a deficit of R225 billion. The Committee asked if the power utility’s financial challenges would lead to another electricity increase.
Chairperson of the Committee, Ms Dipuo Letsatsi-Duba, said: “We have heard that you have been downgraded. This is a concern for us as this will affect Eskom’s borrowing capacity. We cannot afford not to have an efficient Eskom. The country needs energy to create employment opportunities to expand and grow the economy,” said Letsatsi-Duba.
She added: “We strongly believe that the success of Eskom does not only depend on their plans it depends on all of us to assist them to get out of this situation. We want the power utility to be financially sustainable and the response measures presented today in addressing liquidity challenges will ensure that the company is economically and financially viable.”
The Committee requested the power utility to provide an update on renegotiating the pricing contracts with BHP Billiton. In its response, Eskom indicated that the matter was with the energy regulator NERSA and this would follow a public participation process. The meeting provided an opportunity for Eskom to clarify issues that have been in the public domain. The Committee questioned Eskom on the systems in place to mitigate the problem of coal supply and plans in ensuring that the company does not have challenges of wet coal in light of the rain season.
The Committee welcomed and appreciated the youth programme that the power utility has embarked on in terms of providing skills training to approximately 4000 learners. Members of the Committee proposed that communication be improved so that opportunities offered were extended to rural communities. The Committee was of the view that a lasting solution needed to be found in addressing the municipal debt owed to Eskom. The debt now stands at approximately R10 billion.
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Ms Yoliswa Landu
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