Calls to privatise Eskom misguided: minister

Minister of Public Enterprises, Lynne Brown, says that the debate about the privatisation of Eskom is misguided.

Instead, the debate should be about the long-term resolution to the  country’s energy challenges.

It follows a report in Business Day on Tuesday (5 August), citing a number of unnamed Cabinet Ministers and government officials, who advocated for the unbundling and partial privatisation of Eskom.

The Minister reiterated comments she made to the Joint Portfolio Committee on Energy and Public Enterprises in Cape Town last week.

During her statement to the Joint Committee, Minister Brown said that the long-term resolution of the electricity situation will require the following:

  • Agreement on what future energy mix is optimal for the country;
  • Agreement on the optimal industry structure;
  • A major boost to capacity to undertake successful future build programmes; and
  • Decisions on the extent to which future build projects will be undertaken by the private sector.

These guidelines were in support of President Jacob Zuma’s announcement during the State of the Nation in June 2014 when he said: “To prepare for the implementation of the energy plan, we need to finalise the legislation that relates to the restructuring of the energy industry.”

Brown said the end-state of our electricity situation does not mean the fragmentation of Eskom. Instead it should be complementary in nature.

“Eskom is critical for Government to implement its developmental agenda. And it would be a grave mistake to privatise this critical player in the economy.

“I want to indicate that there is a portfolio of options for the Inter-Ministerial Task Team to consider. To my knowledge Cabinet has not discussed the matter of privatisation and there is no need to unnecessary raise temperatures around this matter.

“It is critical that the private sector participates in the energy sector and through IPPs this practice is firmly entrenched,” said Minister Brown.

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Calls to privatise Eskom misguided: minister