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Gordhan expects full assessment on Eskom's troubles within 2 weeks

Feb 17 2019 17:02
Fin24

While Public Enterprises Minister Pravin Gordhan is hoping to get a report back from the team tasked with assessing the problems at Eskom within two weeks, an analyst says bringing in external help shows the risk of outsiders coming into the power utility's "challenging" culture.

Gordhan was being interviewed on The Fix, hosted by Karima Brown on Sunday. During the interview, he also spoke about Eskom's financial, technical and operational woes.

The team is made up of both SA experts and international experts from Italy.

Gordhan made the announcement of external technical assistance in an emailed statement on Tuesday as part of his plans to fix the debt-laden power utility.

The Italian experts are from energy giant Enel, which describes itself as "the largest private player in the African continent's renewable sector".

This after Gordhan earlier this week described the crisis at Eskom as an "emergency" after the power utility announced load shedding for the first time since December.

Load shedding was implemented on Sunday and continued for much of the week. On Monday, for the first time in its history, Eskom announced Stage 4 load shedding but then on Saturday announced that the likelihood of load shedding over the next few days was minimal.

"We are beginning to get to know what we don't know," Gordhan said, adding that in December, he was given assurances by the Eskom management in terms of its 9-point turnaround strategy. 

"Then we had that [load shedding] incident a week ago. We have interrogated those problems and a SA team of experts, backed up by international experts have to give us an independent overview."

He said they needed the experts to highlight what exactly the problem was and where the main deficiencies were.

Eskom’s ‘challenging’ culture

In a notice to clients on Sunday, Peter Attard Montalto, head of capital markets research at Intellidex, said bringing in Enel's external engineers may have come as a surprise to Eskom management.

"This announcement appears not to have been fully known within Eskom, in our view, and shows the risk of outsiders coming into Eskom’s ‘challenging’ culture."

He also noted that Intellidex views the move as more of a sense check on what is going on within Eskom for DPE as opposed to necessarily moving the dial on load shedding risk in the short term.

"The issues on load shedding are simply too numerous and interwoven – and are all fully known. What external influences can do however is start to move the dial on more medium run load shedding risk through 2020 especially where the grid is still expected to remain very tight," said Montalto.

pravin gordhan  |  eskom  |  load shedding  |  electricity
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