To be or not to be green – that is the question, Eskom

Will Eskom Green operate on a ‘transparent and non-discriminatory basis, consistent with market rules that apply equally to all participants’ … and without ‘public money’? Picture: Devina Haripersad/The Citizen News President Cyril Ramaphosa’s announcement during his State of the Nation Address (Sona) on 12 February creates the ideal platform to define a credible end state for Eskom Holdings – and one of the big questions is around its renewable energy arm, Eskom Green. This is clear from a new report that provides a roadmap for the implementation of South African electricity supply industry reforms that have been announced in terms of policy, but lag in delivery.

The Policy to Power report drafted by consultancy group Krutham on behalf of the South African Energy Traders Association (Saeta) sets out 10 steps that it argues must be taken immediately to realise the envisaged reforms. This includes defining a credible end state for Eskom Holdings. Eskom announced in December that it would restructure into a holding company with four subsidiaries: “Additionally, a new and independent Transmission System Operator (TSO) will be established outside of Eskom,” it stated.

This plan, endorsed by Minister of Electricity and Energy Kgosientsho Ramokgopa and the Eskom board, was a departure from the roadmap announced by the late Pravin Gordhan – who at the time held the public enterprises portfolio, which included Eskom. In terms of that document, the NTCSA would have been an independent company outside of Eskom that would have included ownership of the network as well as the TSO. This deviation created a lot of uncertainty among investors and creditors.

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They objected, arguing that only a completely independent NTCSA that owns and manages the network and future energy market would ensure a level playing field and successful industry reforms. During his Sona, Ramaphosa intervened and confirmed that the original plan would be implemented.

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