ESKOM: PRICE HIKE WON’T SOLVE THE CRISIS. HERE’S WHAT COULD
• Move ahead with restructuring and unbundling Eskom, especially Eskom Generation.
• Sell off non-core assets and some core generation assets to repay debt.
• Reduce the staff head count and remuneration and improve efficiency and productivity.
• Improve procurement to reduce waste and cut corruption and maladministration.
• Take on non-government shareholders to recapitalise the entities with non-government equity to help pay back debt.
• Sell off core loss-making distribution assets, for example, in Soweto and other poorly performing areas, to those who can do things better, to reduce losses and raise money to pay debt.
• Replace poorly performing plants with least-cost new plants (wind and solar energy, and flexible generation capacity).
• Reduce electricity theft and non-payment.
• Improve revenue collection and reduce arrears debt, particularly from municipalities.
• Reduce cable theft and vandalism through better asset protection.
• Implement more effective maintenance.
• Ring-fence the carbon tax and electricity levy on coal-generated electricity paid by Eskom to government and use this towards improving energy efficiency and off-grid electricity.
• Use the electrification grants to Eskom and municipalities to provide off-grid electricity to households.
• List the unbundled entities on the JSE to take on non-government shareholders, raise capital and reduce debt.
Read our full statement on the Nersa granted price increase here.