{"id":61687,"date":"2024-02-24T13:51:47","date_gmt":"2024-02-24T13:51:47","guid":{"rendered":"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans"},"modified":"2024-02-24T14:35:54","modified_gmt":"2024-02-24T14:35:54","slug":"eskom-loses-r47-8-billion-of-cheap-loans","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans","title":{"rendered":"Eskom loses R47.8 billion of cheap loans"},"content":{"rendered":"

Africa-Press – South-Africa. <\/strong><\/span>South Africa\u2019s state power utility has failed to tap $2.5 billion (R47.8 billion) of cheap loans to build critical transmission infrastructure that would help end the country\u2019s crippling energy crisis.<\/p>\n

That\u2019s brought a landmark climate finance agreement \u2013 the Just Energy Transition Partnership \u2013 to a virtual halt and extended the country\u2019s reliance on coal plants.<\/p>\n

Finance ministry pressure on Eskom to not take on new debt and a lack of clarity on how private investors can participate are hindering the deployment of about $7 billion (R134 billion) of energy financing, according to a US Treasury official and six other people familiar with the situation.<\/p>\n

Eskom said a moratorium on its taking on more debt without the approval of the finance minister is the main reason for its inability to finalize loans.<\/p>\n

That funding is intended to target a key weakness in South Africa\u2019s energy system: the lack of transmission capacity in provinces with the best solar and wind power potential.<\/p>\n

\u201cEskom would welcome the allocation of a portion of these funds to allow it to expand its transmission network,\u201d the company said in a response to questions.<\/p>\n

The slow progress of the JETP, first announced at an international climate conference in 2021, highlights the difficulties in transitioning to cleaner energy and the need to cushion the blow for coal-dependent communities.<\/p>\n

South Africa\u2019s pact \u2014 with the US, UK, France, Germany, European Union, Netherlands and Denmark \u2013 was hailed as a prototype for similar agreements with other developing nations, such as Indonesia and Vietnam.<\/p>\n

But it\u2019s been beset by political infighting and foot-dragging over the closure of coal-fueled power plants.<\/p>\n

No grid<\/p>\n

Eskom, which has about R443 billion ($23 billion) in debt, said it\u2019s working with the finance ministry and the presidency on how to access the loans, including \u201coff-balance sheet options\u201d \u2013 a reference to liabilities that the utility would not have direct legal responsibility for.<\/p>\n

South Africa\u2019s presidency said exemptions may be issued to allow Eskom to invest in transmission infrastructure. South Africa\u2019s National Treasury didn\u2019t respond to a request for comment.<\/p>\n

The country\u2019s Western partners are frustrated but remain committed, the people said, asking not to be identified as the conversations are private.<\/p>\n

The amount of money available has risen from an initial $8.5 billion (R162 billion) in loans, grants and guarantees to $9.3 billion (R178 billion), the US Treasury official said, withholding their name in line with government policy.<\/p>\n

Of that amount, $716 million (R13.7 billion) is in the form of grants.<\/p>\n

The investment partners are encouraging Eskom and South Africa\u2019s National Treasury to take up the transmission loans because they\u2019re available at attractive interest rates, and a stronger grid is essential for accelerating investment in power plants, the US official said.<\/p>\n

They\u2019re hoping for progress once Dan Marokane takes over as Eskom\u2019s chief executive officer next month, the official said.<\/p>\n

South Africa needs to pass its Electricity Regulation Amendment Bill and clarify how the private sector can invest in transmission assets, the official said.<\/p>\n

The nation is yet to complete the separation of Eskom\u2019s transmission unit from the rest of the company, a key step needed to attract investment, despite President Cyril Ramaphosa saying the government would \u201cimmediately embark\u201d on the process in February 2019.<\/p>\n

An implementation plan for the JETP funds was completed in November, months behind schedule.<\/p>\n

The presidency said its information on how private companies can invest in transmission will be provided in \u201cdue course,\u201d and the government plans to pass the ERA bill before elections, which are on May 29.<\/p>\n

Officials representing other countries taking part in the pact expressed similar concerns about the pace of investment in transmission and said there is a lack of projects ready for funding.<\/p>\n

A \u20ac2.1 billion ($2.27 billion) Spanish program to help finance South African energy and water projects, which is separate from the JETP, has seen a similar lack of take up, the people said.<\/p>\n

The European Investment Bank, the agency through which the European Union is channelling its contribution, said it \u201cstands ready\u201d to provide \u20ac1 billion, but it has yet to deploy any capital as part of the program.<\/p>\n

Adding to the frustration is that the coal-fired power plants that South Africa agreed to decommission as part of the pact are now set to stay open for longer, jeopardizing commitments to reduce greenhouse gas emissions.<\/p>\n

The US official said that while the decision was understandable, as South Africa is experiencing regular power cuts, it threatens the key goal of the JETP.<\/p>\n

The presidency said it doesn\u2019t expect the \u201ctrajectory\u201d of the decline in emissions to be affected<\/p>\n

So far, almost $591 million in grants have been allocated, and just \u20ac1.1 billion in loans have been disbursed by France and Germany, with the other investment partners yet to announce distribution of their pledges.<\/p>\n

For More News And Analysis About South-Africa<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – South-Africa. South Africa\u2019s state power utility has failed to tap $2.5 billion (R47.8 billion) of cheap loans to build critical transmission infrastructure that would help end the country\u2019s crippling energy crisis. That\u2019s brought a landmark climate finance agreement \u2013 the Just Energy Transition Partnership \u2013 to a virtual halt and extended the country\u2019s […]<\/p>\n","protected":false},"author":84,"featured_media":61686,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[274,315,275],"class_list":["post-61687","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-africa-press","tag-africa-press-south-africa","tag-south-africa-2"],"yoast_head":"\nEskom loses R47.8 billion of cheap loans - South Africa<\/title>\n<meta name=\"description\" content=\"South Africa\u2019s state power utility has failed to tap $2.5 billion (R47.8 billion) of cheap loans to build critical trans ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Eskom loses R47.8 billion of cheap loans\" \/>\n<meta property=\"og:description\" content=\"South Africa\u2019s state power utility has failed to tap $2.5 billion (R47.8 billion) of cheap loans to build critical trans ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans\" \/>\n<meta property=\"og:site_name\" content=\"South Africa\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2024-02-24T13:51:47+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-02-24T14:35:54+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/02\/sm_1708772594.189728.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"768\" \/>\n\t<meta property=\"og:image:height\" content=\"432\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Eskom loses R47.8 billion of cheap loans\",\"datePublished\":\"2024-02-24T13:51:47+00:00\",\"dateModified\":\"2024-02-24T14:35:54+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans\"},\"wordCount\":819,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/02\/sm_1708772594.189728.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-South-Africa\",\"South-Africa\"],\"articleSection\":[\"all news\",\"economy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans\",\"url\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/eskom-loses-r47-8-billion-of-cheap-loans\",\"name\":\"Eskom loses R47.8 billion of cheap loans - 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