Eskom grid firm is one step closer
• Head of Sasol’s energy business to chair transmission company
In another step forward for the separation of Eskom into three stand-alone entities for generation, transmission and distribution, the state-owned power utility on Tuesday announced the names of appointees to serve on the board of the recently established National Transmission Company of SA.
Priscillah Mabelane, executive vice-president for Sasol’s energy business, has been appointed as chair. One of the immediate tasks that the board will face is to help facilitate the appointment of a CEO for the national transmission company.
Once the company has been operationalised, the board will have to support the executive in setting up a range of new trading platforms that will allow for the buying and selling of electricity among multiple parties.
SA’s electricity market, which has long been dominated by Eskom, has already started opening, allowing buyers and sellers to trade via physical bilaterals or wheeling contracts.
However, Eskom has previously pointed out that because these private energy trades are happening without a central market mechanism, the system operator is flying almost blind. Until a transmission system operator is established, and as the volume of electricity trading increases, the national transmission company will fulfil the role of developing such a central market mechanism.
That, in turn, will give Eskom greater visibility of what is happening on the network so that it is able to plan around it.
Other board members include Brian Armstrong, a former Telkom COO, who will serve as the lead independent director; Prof Mark Swilling, former chair of the Development Bank of Southern Africa; and Carmen le Grange, co-director of the Centre for Sustainability Transitions at Stellenbosch University and a former Denel CFO.
“The [board] appointment takes Eskom a step closer to unlocking the potential that comes with the planned transformation of the electricity industry” said Eskom chair Mteto Nyati. “We thank all [those] who raised their hands to guide Eskom into a future where South Africans have a reliable, affordable and environmentally friendly supply of power.”
The stand-alone transmission company will play a critical role in allowing for the liberalisation of the electricity trading market. It will function as an interim facility, taking on the role of the transmission system operator, which can be established only after the Electricity Regulation Amendment Bill, now making its way through parliament, has been passed.
In this role, the transmission company will begin to facilitate the creation of a transparent platform for the competitive trading of electricity among multiple buyers and sellers.
It is viewed as a vital move to attract private sector financing to upgrade and expand the transmission network, which will conservatively require an investment of about R370bn over the next 10 years.
There has been a delay in passing the Electricity Regulation Amendment Bill after parliament’s portfolio committee on mineral resources & energy announced in December that it is planning to repeat public hearings on the bill.
The bill will provide a legal framework for setting up and operationalising the company and later the transmission system operator, which will manage the national grid.
In November the World
Bank, one of Eskom’s key creditors, granted its consent for the legal separation of the transmission division from Eskom Holdings to the new National Transmission Company of SA, but consent from some other lenders is still outstanding.
Other board members are energy economist Lungile Mashele; former MTN executive Anu Sing; chemical engineer Nkosinathi Solomon; Auke Lont, who has 25 years’ experience in the energy industry; Prof Francis Petersen, the vice-chancellor of the University of the Free State; MBA graduate Sedzani Mudau; Busisiwe Vilakazi, a former senior researcher at the CSIR; and Tryphosa Ramano, who is on the board of Eskom.