Newsletter| Eskom’s financial black hole could be exacerbated from yet another quarter – with defaulting municipalities gaining new powers to not pay for power, without immediate consequences
Eskom’s financial black hole, and its inability to contain the growing power crisis, could be exacerbated from yet another quarter – withThe power utility is planning to appeal a little-noticed court ruling, barring it from its previous practice of cutting power for extended periods to municipalities that have defaulted on their bulk power payments.
On the other hand, Michael Jacks, head of equity research in Johannesburg at Bank of America Merrill Lynch, believes that load shedding could take South Africa into a technical recession.The impact is massively uneven in some sectors. This cost massively outstrips the impact of lost revenue, Eskom CEO Phakamani Hadebe told City Press last week.
Eskom would more likely than not be approaching the courts to force Nersa to better explain its decision, which leaves the power utility R150 billion short of the revenue it said it wanted from Nersa and the government over the next three years. Medupi units were running at 52% capacity early last week, according to data in the Eskom presentation.Kusile, which has three operational units, was providing 47% of what it theoretically could.
Then CEO Tshediso Matona said that the “lights on at all costs” policy was being abandoned and load shedding was necessarily being instituted in order for necessary maintenance to take place. The reality is, however, that the power system would have held up if the now-infamous Medupi and Kusile stations had been completed on time.
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