World Biz
S. Africa's debt-ridden electricity utility gets French funding to enhance power transmission
Last Updated: 2018-12-14 11:27 | Xinhua
 Save  Print   E-mail

South Africa's electricity utility Eskom said on Thursday that it has secured a loan worth 1.5 billion rand (about 107 million U.S. dollars) from French Development Agency (AFD) to enhance power transmission.

An agreement to this effect was signed between the two sides on Thursday, Eskom said.

The loan facility from AFD aims to support Eskom's investment policy in strengthening its high-voltage electricity network, in order to ensure the integration of planned or under-construction renewable energy sources, Eskom said.

This is in line with Eskom's Transmission Development Plan 2019-2028 investment of 91 billion rand for the construction of 6,535 km of high voltage lines and the installation of 45,900 MVA of additional transformer capacity.

The transmission system plays a pivotal role in the nation-wide provision of electricity, as it delivers electricity from the power stations to distribution centers across South Africa, said Eskom.

"AFD remains part of a core of longstanding partners to Eskom, and we regard the signing of this loan agreement as a formal yet symbolic gesture of a sustainable partnership in aiding Eskom to enhance the security of supply, and stabilize the power systems in South Africa," said Phakamani Hadebe, Eskom's Group Chief Executive.

"AFD's funding to Eskom reaffirms our commitment to support the public utility's efforts to diversify its energy mix, which will ultimately strengthen its capacity to respond to the growing energy needs of South Africa while addressing the climate change challenges attached to it," said Bruno Deprince, AFD's Regional Director.

This funding also demonstrates AFD's support to Eskom in a period of transition and recovery, he added.

Eskom, which provides more than 95 percent of the electricity consumed in South Africa, has implemented rolling blackouts for more than one month, seriously affecting economic activities and people's lives.

The state-run parastatal has been blamed for poor management and rampant corruption which are believed to be the main factors for the blackouts.

Eskom says it implements load shedding rotationally as a last resort to protect the power system from a total collapse.

Cash-strapped Eskom reportedly wants the South African government to absorb about 100 billion rand of its debt as part of a rescue plan for the utility.

International ratings agencies have warned that Eskom is a risk to the health of South Africa's economy.

Share to 
Related Articles:
Most Popular
Chinese | BIG5 | Deutsch
About | About the Economic Daily | Contact us
Copyright 2003-2015 China Economic Net. All right reserved