Government will look into Eskom independent power decision after elections

Finance Minister Pravin Gordhan says the government will look into Eskom’s decision to cut its purchase of independent producer electricity after the elections.

Last week‚ Eskom sent shock waves through the energy sector when it said it would not sign further power purchase agreements‚ leaving the future of independent power producers hanging by a thread.

In a letter to Energy Minister Tina Joemat-Pettersson from Eskom chairman Ben Ngubane‚ the utility states that it will not sign further power purchase agreements without engagement over the matter.

The government has been enthusiastic about getting more power from independent power producers‚ in particular those who use renewable sources of generation.

BDLive reported that by introducing private sector companies into energy generation‚ the Renewable Independent Power Producers Programme (REIPPP) was able to mobilise R195-billion in direct investment and brought 2‚145MW into the grid.

Gordhan did not want to comment at length about Eskom’s sudden change of tune.

“On the Eskom stuff‚ that was an announcement they made of their own and one that government as whole will have to look at after the local government elections. Right now we’re focusing on getting all of your votes‚” he told journalists on the sidelines of the Nedgroup Investment Summit.

Gordhan said things needed to change in South Africa for the country to break free from its low economic growth path. He admitted that Treasury’s growth forecast for the year was unlikely to remain at 0.9% when it is released in October.

“The world is in a low growth trap. Africa is in the low growth trap‚ and so are we. That is why we are saying to all our social partners and entrepreneurs in particular that we have to do things differently. You have to start committing to your own economy and investing your money...We will remain in the low growth trap unless we do things differently‚” he said.