Johannesburg - Power utility Eskom reported a surge in first-half profit on Tuesday boosted by higher power tariffs, and said it has secured the necessary funding for its expansion programme.
Cash-strapped Eskom has been stuggling to raise the R440bn it needs over seven years to build new power palnts to meet fast-rising demand.
"We now have the certainty we need to go ahead with the build programme," Eskom CEO
Brian Dames told a news conference.
"Supply will be tight up to 2015, and particularly so next year and in 2012, until our large new power
stations come on line."
While Eskom has had a monopoly on the country's power supply, independent power producers (IPPs) are expected to join the generation business and be included in the government's new energy plan currently under discussion.
Everyone must do their bit Dames said Eskom had addressed its R440bn of funding through a combination of measures. Uncommitted projects were excluded and it secured and identified funding sources.
This included R160bn from debt capital markets, R100bn from development finance institutions and export credit agencies and R40bn from the government, comprising R20bn remaining of the original R60bn government loan and a proposed additional equity injection of R20bn.
Eskom said a large amount of construction work on the build programme had already been completed.
It said net profit for the six months to end-September totalled R9.5bn, compared with R1.1bn in the same period a year earlier.
Revenue totalled R51.1bn, compared with R38.3bn in the same period a year earlier.
Eskom had already signed contracts with IPPs to avoid rolling blackouts, it also said.
It is also ready to sign up 1 000MW of power from IPPs and another 1 000MW from gas turbines, the SABC reported.
"The situation is really tight and Eskom has been very clear about risks that we face in the next three
years, but we can avoid blackouts as long as Eskom continues with its built programme without delay and does what it has to do in terms of plant performance," said divisional executive for systems operations and planning at Eskom, Kannan Lakmeeharan.
"We need IPPs to come on... and we need all consumers to save electricity; only if we do all those three things can we ensure there are no blackouts, so it's not just Eskom alone, it has to be a partnership with South Africa," he said.
New Public Enterprises Minister
Malusi Gigaba on Tuesday reaffirmed the government's support for Eskom.
Speaking at the release of Eskom's interim results, Gigaba said the government would continue supporting Eskom to ensure the company "kept the lights on".
Gigaba said the security of electricity supply had become the key focus, highlighting the electricity crisis of 2008 .
Gigaba warned that "we are not out of the woods yet".
He said the department supported government's proposed R20bn equity injection for Eskom.