The civil rights organisation AfriForum says Pres. Cyril Ramaphosa’s announcement during his State of the Nation Address that Eskom will be decentralised is anything but adequate to turn around the struggling electricity giant. According to Ramaphosa, Eskom will be unbundled into three separate entities, namely transmission, generation and distribution.
Morné Mostert, AfriForum’s Head of Local Government Affairs, says Eskom is in practice already divided into these three entities and that is why this announcement is without any substance. “True unbundling means that Eskom no longer has the monopoly on electricity supply in South Africa at its disposal.”
According to Dr Eugene Brink, AfriForum’s Strategic Advisor for Community Affairs, Eskom will now merely be under corrupt state control in separate entities instead of one big company with the same qualities. “This doesn’t hand control over to communities or anyone else but the state and is merely a cosmetic means to appease investors which doesn’t tackle the root cause of the problems.”
Mostert condemns Ramaphosa’s decision to grant Eskom additional state assistance considering the large-scale historic and current corruption. “Nersa will probably not grant Eskom’s tariff increase of 17,4% and this meant that the management of Eskom has already approached the National Treasury. Taxpayers will subsequently need to once again shoulder the burden, either through tariffs or taxes.”
“The idea is for Eskom to become less dependent on the state and the taxpayer. Ramaphosa’s announcement has however done nothing to give effect thereto,” concludes Brink.