South Africa’s state-owned power utility Eskom is in dire straits. The electric power company now has more than $30 billion of debt and its current revenue no longer provides enough money to cover daily operational costs. Now, as a result of the ongoing financial crisis at the company, Eskom is now load-shedding with rolling blackouts across the country.
Given that Eskom provides almost the entire country’s electricity, the stakes for both president Cyril Ramaphosa and South Africa at large are both enormous.
“I think South Africa is running out of time and I think there is a lot that China can help with particularly in relation to renewable energy. China is a world leader on renewable energy, but I think at the moment it is also that South Africa has been in a coal mind set for a long time and a lot of people in the government come from mining. “— Dr. Cobus van Staden, South African Institute of International Affairs
Back in April, there were indications that the China Development Bank might step in to provide $2.5 billion in emergency financing but those talks have now reportedly gone cold. Nonetheless, South Africa’s Department of Public Enterprises, who oversees Eskom, says it remains optimistic a deal with China can be reached.
This week Eric & Cobus speak with University of Johannesburg professor Hartmut Winkler about the fate of Eskom and what role, if any, is China playing to help salvage the company.
- Fin24: Everything you need to know about government’s Eskom bailouts by Lameez Omarjee
- Fin24: Government confident Eskom’s China funds will come through by month-end by Khulekani Magubane
- eNCA: Eskom on the verge of financial ruin: Blom
About Hartmut Winkler:
Hartmut Winkler is a lifelong academic who served stints as Dean of Science and Acting Deputy Vice-Chancellor: Academic at the former Vista University in South Africa and was until recently the Head of Physics at the University of Johannesburg. His research interests range from astrophysics through to atmospheric physics, solar energy, and energy supply. Professor Winkler is also a vocal commentator on South African energy issues, especially the renewables versus nuclear debate.