South Africa's Eskom to reduce power cuts but long-term outlook bleak

Electricity minister Kgosientsho Ramokgopa said there is a need to board new generating capacity, especially renewable energy, to ease the pressure on the national grid.

Speaking while giving an update on the implementation of the Energy Action Plan on Tuesday, the minister shared that the department has so far shown "tremendous progress" in finding transmission solutions.

"We have been doing an extraordinary amount of work. The team was [at the World Economic Forum annual meeting] in Davos. Part of those conversations was to enter into bilateral discussions with some of the potential financiers," he said, as per SA News.

"We have...financing. That is private sector willing to come into the space of transmission. We had conversations...with the heads of missions that are represented here in the country and they did confirm that availability of that financing," he added.

Ramokgopa clarified that the government is encouraging the participation of the private sector in the transmission space, though it will remain the owner of the power grid via Eskom and the National Transmission Company of South Africa.

"What we have been doing is to find an architecture and legal configuration on how best we are going to access [funding] and one of the areas that is receiving attention is the possibility of us putting together...something that is akin to the IPP [Independent Power Producer Procurement] office on the generation Independent Transmission Project office," he explained.

Ramokgopa noted that this funding ensures that the government procures with speed and agility and applies some degree of innovation. He added that the department can also access the "liquidity that's sitting with the private sector without relinquishing state ownership of the grid."

However, the minister admitted that transmission expansion is facing some challenges and that the department is working on tackling those problems. He pointed out that these challenges are almost equivalent to the ones on the generation side.

"If they are not tackled immediately, they are likely to be even more catastrophic compared to the challenges on the generation side because those are likely to undermine our ability to maintain the integrity of the system," he said.

Besides sharing the challenges and need to improve the grid, the minister noted that South Africa's electricity system continues to show improvement.

Earlier this month, Ramokgopa warned South Africans that they could expect load shedding on some days, adding that energy company Eskom was working hard to improve the generation system.