Public enterprises minister Lynne Brown on Wednesday announced the renewal of short-term power purchase contracts for at least 827MW of generation capacity between Eskom and independent power producers.
She also announced her acceptance of the resignation of Eskom board chairman Zola Tsotsi and the board proposal of Dr Ben Ngubane as acting chairman.
Brown said: “Given the tight electricity supply, the renewal of the co-generation was essential to ensure that this 827MW was retained in the system.” Moneyweb earlier reported that the existing contracts were to lapse on March 31 and energy regulator Nersa gave approval for their extension and the conclusion of additional contract for a year to a total of 1 359MW.
No provision was made for the cost of these contracts in Eskom’s tariff application for the current five year tariff period (MYPD3) that ends on March 31, 2018, and Nersa said Eskom can reclaim the cost through the regulatory clearing account. This may result in further tariff increases at a later stage.
Brown said she will consult over the next few weeks to appoint a permanent chairperson for Eskom and will in due course communicate progress in this regard.
“It is my firm view that the Board and the Shareholder continue to act in the best interest of the company and the people of South Africa to preserve the value and integrity of the company,” she said.
“As Shareholder Representative, I remain guided by the provisions of Eskom’s legal framework, which includes the Companies Act and the Memorandum of Incorporation, in carrying out my duties and responsibilities to the company.”
She also said: “As shareholder representative, I want to state unequivocally that Eskom is on solid ground and government is committed to deliver on its mandate of providing a reliable electricity service to the country.”