Former Eskom CEO weighs in on the status of SA's electricity challenges.
Eskom should not be spending billions of rand on retrofitting old, tired coal-fired plants to become environmentally compliant but rather use the funds to upgrade the country’s constrained transmission grid so that more private-sector electricity generation capacity can come online. This is according to André de Ruyter, former Eskom CEO.
“The idea of bureaucrats making investment decisions when they have the moral hazard of cheap finance guaranteed by the government who competes with willing and able private capital strikes me as a completely perverse outcome,” De Ruyter said.De Ruyter said grid capacity is a big constraint and “is holding back investment”.
De Ruyter, who left the power utility in February 2023, predicts that when the electricity market eventually takes off, there will be more bilateral power purchase agreements. Asked if he has a sense that South Africa is turning the tide with its electricity woes, De Ruyter said it is indeed so that some obstacles have been removed, such as onerous regulations in procurement areas that created enormous difficulties.
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