WRAP: There are no plans to privatise Eskom - Gordhan | Fin24
 
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WRAP: There are no plans to privatise Eskom - Gordhan

2018-12-06 13:55

The public enterprises minister was briefing the media on the state of the power utility after days of load shedding, power generation unit breakdowns and reports it wants the state to take over R100bn of its R419bn debt.

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Last Updated at 09:28
06 Dec 16:06

Gordhan is wrapping up now, and brings things back to Eskom's imbalance between cost and revenue. "The country should participate in that debate," he says. 

"All 40 000 people in Eskom must become a lot more aware of the responsibility that we have to 60 million citizens, on the one hand, and the economy on the other hand,"he says.

He ends with a joke"If you leave about now you will avoid load shedding".  


06 Dec 15:58

Gordhan's top 10 quotes on load shedding and Eskom's 'double whammy'

Public Enterprises Minister Pravin Gordhan was briefing the media on the latest operational matters at debt-laden power utility Eskom following days of load shedding. From state capture to Eskom's communication strategy, forensic reports and the cancellation of leave for managers, Gordhan did not hold back.


06 Dec 15:48

Mabuza underlines that Eskom does have a medium and long-term plan to deal with capacity, generation and debt. 

The plan needs to be presented to government, he says.  


06 Dec 15:36

Gordhan is asked about Eskom’s debt levels of over R400bn. 

He says it cannot keep rolling over debt and says a proper debate needs to take place around what to do. He says he would welcome ideas. 

He likens Eskom to company that is bringing in R1000 in revenue and paying R1500 in expenses. “That R500 has to come from somewhere,” he says. 

There is no government decision to privatise the utility, he says, adding that claims that the SA government want to take it private are ‘mischievous”. 

Gordhan does not want to comment more on debt restructuring, saying that it is being discussed with government and an update will be provided in 2019. 

Mabuza, meanwhile, calls Eskom's debt a "millstone". 

As journalists keep asking Gordhan et al about debt, he asks them to please ask about something else. "Any [further] question to do with debt won't be helpful at this time," he says. 


06 Dec 15:25

Gordhan is asked about a tweet he referred to as "treasonous".

He has not said who sent the tweet or what he said, telling journalists to work it out for themselves. 

"Undermining the electricity system, which undermines the economy which effects every citizen in this country is treasonous, you can use it with a small t or a big T". 


06 Dec 15:22

Mabuza says that Eskom cannot solve the problems now plaguing it alone. 

"These are problems we have all caused as South Africans". 

The press is now asking questions. 


06 Dec 15:18

Eskom chairperson Jabu Mabuza takes over from the minister. 

In a similar vein to what Gordhan said earlier, Mabuza says that Eskom has not been doing enough to maintain its fleet of power plants. 

"Like all mechanical stuff, if you don't maintain it, it is subject to wear and tear". 


06 Dec 15:15

06 Dec 15:11

06 Dec 15:07

Gordhan says Eskom is working to make sure that there is no 'dark Christmas'. 

"So to round up we are going to try our best to get to a point where load shedding disappears before Christmas," he says. "Some newspapers and media have been talking about dark Christmas...we are working very hard to make sure that doesn't happen."

"Second, we want to assure businesses that by the time you get back to work in January, we have much more stable situation". 


06 Dec 14:59

Gordhan says contractors at the Medupi and Kusile power stations have been falling short in design and quality, and a forensic investigation has started into what went wrong.

He mentions Hitachi, who were fined $19m by the SEC in the US in 2015 for corrupt payments to the ANC's investment arm Chancellor House. 

Hitachi paid the fine but did not deny or confirm the charges.

"Somebody is making money out of doubling the cost of Medupi," says Gordhan. 

The public enterprises minister says while Eskom may have 'suspicions' around who is inflating prices, they will await the result of the forensic report. 

He also earlier said that Eskom would employ a few independent experts to give the power utility's board an arms length view of its plans. 


06 Dec 14:48

Gordhan says load shedding contracts the economy, and the plan is to make sure as far as possible that Stage 2 load shedding is cut down next year. 

"Ideally the kind good good numbers we saw from the third quarter - 2.2% growth - is what Eskom doesn't want to be seen messing around with." 

He also says the Eskom team is working to increase stockpiles of coal at power stations to 33 days. 


06 Dec 14:44

Gordhan has said that says all senior Eskom senior managers have been asked to cancel leave, and they will be physically visiting power stations throughout the country. 

He says he wants to see more urgency. 


06 Dec 14:42

Gordhan has said there is only one energy expert in the department of public enterprises, and this capacity was run down during the time of his predecessor. 

"We need to strengthen the department's capacity to monitor what is going on."


06 Dec 14:38

Gordhan now talks about why there has been load shedding. 

He says that while Eskom has 47 000 megawatts in installed capacity, it can currently only use 26 000 to 27 000 MW.

Between 9 000 and 11 500 MW of installed capacity is not contributing to the grid as these generating units are being repaired after breakdowns.

Then it has to keep a reserve margin of 2 500. 



06 Dec 14:35

Gordhan says that a team will look at whether load shedding schedules are correct on the ground, as many complaints have been received to say they are not. 

He also says Eskom must improve how it communicates that load shedding has started, saying a tweet is not enough. 


06 Dec 14:31
Public Enterprises Minister Pravin Gordhan says Eskom was "one of the centres of state capture" and its current difficulties stem, in part, from the state capture project, together with old power stations. 

06 Dec 14:26

Eskom chairperson Jabu Mabuza, Public Enterprises Minister Pravin Gordhan and the Eskom CEO have arrived. 


06 Dec 14:20

Watch News24's video for a quick overview of what is behind the load shedding crisis.


06 Dec 14:17

Journalists have been told that Eskom's management team has been slightly delayed and the briefing will start in a few minutes.


06 Dec 14:12
A seat with a name badge has been reserved for Minister of Public Enterprises Pravin Gordhan, meaning he may also be involved in the briefing. 

06 Dec 14:07

06 Dec 13:56

Vicious Circle

Fin24 unpacks the issues facing the power utility, from increasing coal and employment costs, to stagnant revenue growth and ever-rising debt.


06 Dec 13:55

Eskom CEO Phakamani Hadebe will on Thursday afternoon give an operational update on the state of the debt-laden and cash-strapped state power utility. 

Eskom has been forced to implement stage 2 load shedding every day of this week, as it battles to repair broken power generating units. 

According to Bloomberg and Business Day, it is also considering asking the government to take over R100bn of its R419bn debt burden. 

Economists and ratings agencies, meanwhile, say problems in supplying industry and business with uninterrupted electricity is sure to further depress SA's already moribund GDP growth rate. 


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