Eskom grid transfer could cost up to 130 billion rand
By the AFREEQUE newsroom, based on SABC News
South African Electricity Minister Kgosientsho Ramokgopa estimates that transferring Eskom’s electricity grid to an independent operator will cost between 80 billion and 130 billion rand. Funding mechanisms and the transfer of assets at fair value are being defined, according to SABC News.
The transfer of South Africa’s electricity grid assets from Eskom to an independent operator could cost between 80 billion and 130 billion rand, Electricity and Energy Minister Kgosientsho Ramokgopa told SABC News. The estimate covers the transfer of control of the grid to an independent transmission system operator.
Ramokgopa said his department, the Presidency and the National Treasury were working to define the costs and funding mechanisms. The policy governing the transfer is being finalised and provides for the assets to be valued at fair market value. The amount will depend in particular on the valuation of these assets, the minister said at the Kgalema Motlanthe Foundation’s annual forum in the Drakensberg, KwaZulu-Natal.
The government intends to proceed cautiously with electricity sector reform to avoid price rises. Ramokgopa cited the experiences of France, Germany and the United Kingdom as examples from which South Africa should learn. Some observers believe that liberalisation in the United Kingdom and Australia has failed and led to higher tariffs.
