Eskom gets R1.37bn loan

South Africa’s cash-strapped state power utility Eskom said yesterday it had signed a $100 million (R1.37 billion) loan facility with German development bank KfW, to support further investments in the transmission network in Northern Cape.

This would facilitate the grid integration of renewable energy independent power producer projects.

Eskom said the funding, agreed upon by the German and South African governments, would allow for the continuation of the second phase of capacity and reliability improvements in the areas of Harrismith in the Free State and the Greater East London region in the Eastern Cape.

“The signing of this loan facility is a positive contribution towards the successful execution of Eskom’s R72 billion funding requirement for the financial year 201819,” Eskom’s CEO Phakamani Hadebe said.

“The loan forms part of the first new funding that Eskom intends signing with developing finance institutions in this financial year,” he said.

Eskom said the loan facility demonstrated the improved market sentiment and confidence in the ability of the Eskom’s leadership to direct the company on the correct path to recovery and sustainability.

“Furthermore, integrating more renewable sources of energy into the grid will go a long way in helping to reduce South Africa’s carbon dioxide emissions, driving Eskom towards its targeted goals,” Hadebe said.

With the introduction of South Africa’s renewable energy independent power producer procurement programme, KfW extended a R3.9 billion loan to Eskom in March 2015 to facilitate renewable energy grid integration and to strengthen the grid by improving the capacity and reliability of the transmission network.

KfW is one of the world’s leading development and promotional banks, in which the German federal government has an 80% stake and of which various federal states own 20%. – ANA

Integrating renewable energy sources into the grid will reduce CO2 emissions. Phakamani Hadebe CEO Eskom