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Eskom happy about Busa's support

Johannesburg - Electricity utility Eskom has welcomed the recent declaration of support from Business Unity South Africa (Busa) for Eskom's application for a loan from the World Bank.

Eskom said it relies on funding from a combination of existing shareholder equity, borrowings from domestic and international markets and tariffs.

The loan of $3.75bn, is already factored into the funding plan as submitted to Nersa in the MYPD2 application and is critical for South Africa and the region," said Eskom's finance director, Paul O'Flaherty.

"It is recognised that as a developing country, South Africa needs to capitalise responsibly on its natural resources whilst honouring its greater commitment to reduce carbon emissions over time," added O'Flaherty.

This World Bank transaction will fund specific components of Eskom's capital expansion programme such as the Medupi Power Station - the first coal-generating plant in Africa to use supercritical power generation technology. The loan will also simultaneously catalyse new and lower carbon technologies such as large scale solar thermal and wind power. The funding is well aligned to jump-start progress on South Africa's commitment to a lower carbon footprint.

"The proposed funding will combine favourable financing rates with a structured repayment profile thereby making it an economically attractive option to contribute to South Africa's future economic growth," concluded O'Flaherty.

- I-Net Bridge

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