According to Engineering News, President Cyril Ramaphosa told workers at Medupi power station six times in an address on Monday that Eskom will not be sold or privatised.
However, the President said, it was necessary to split Eskom into three divisions – generation, transmission and distribution – as this was needed to improve efficiency and make the electricity supplier competitive.
“That is not privatisation,” Pres. Ramaphosa said.
The combined cost of the Medupi and Kusile power stations have placed immense pressure on Eskom’s balance sheet.
Ramaphosa was accompanied by Pravin Gordhan, the Minister of Public Enterprises, and Jabu Mabuza, acting CEO of Eskom. His visit coincided with the commercialisation of the fifth of six units at the coal-fired power plant.
In brief remarks to the media, Ramaphosa said that all six units at Medupi should be fully operational in 2020. He added that the construction of the power station should be seen as a great achievement for the country.
According to Bloomberg’s calculations, the combined costs of Medupi and Kusile have risen to R451 billion, about the same amount as Eskom’s outstanding debt burden. The two plants were originally expected to be completed by 2015 at a total cost of R163 billion.