The African Development Bank (AfDB) has approved a loan of 2.886 billion rand (about 218 million U.S. dollars) to South Africa's power utility Eskom to ensure power supply within the sub-region, Eskom sources confirmed on Thursday.
The loan will contribute to the upgrade and expansion of Eskom's transmission facilities which are crucial to power supply within the sub-region, the sources said on condition of anonymity.
The funding supports the Eskom Transmission Improvement Project (ETIP), which will see the construction of 555km of 400 kilovolt transmission lines in KwaZulu-Natal and Mpumalanga provinces and the upgrading of substation equipment and improvement of various substation earth mats in Mpumalanga, the AfDB said after approving the loan earlier this week.
The bank's intervention will enable the provision of additional power evacuation paths to the network from the Kusile, Majuba, Drakensburg and Ingula power stations, and will also benefit the utility's corporate restructuring and governance program, the bank said.
The intervention will enhance regional energy trade, end-user energy access for industrial development and address the potential addition of 130 million on-grid connections by 2025, the bank said.
Eskom operates South Africa's national grid, which comprises 157 transmission substations and approximately 31,107km of transmission lines and 160 distribution substations, totaling 139,610MVA of installed transformer capacity.
The utility contributes approximately 77 percent of the total installed power capacity in the Southern Africa Power Pool (SAPP) and makes up approximately 80 percent of the regional power demand.
Eskom, fighting to service its debt worth 368 billion rand (about 26 billion dollars), reportedly is considering to lay off thousands of its workers.
The company has been meeting investors since December to drum up demand for a new dollar bond but has so far failed to get enough support for the transaction.
The utility implemented rolling blackouts in June for the first time since 2015 after protesters blockaded roads and attacked staff when wage negotiations broke down.
