Eskom’s De Ruyter says firm needs to understand Govt.’s rival generation company plans

ESKOM CEO, Andre de Ruyter, welcomed the possibility of a rival electricity generation company as unveiled by mines and energy minister, Gwede Mantashe on February 3, but the utility was not informed of government’s intentions.

Speaking to the Daily Maverick, De Ruyter said it was necessary for the company to understand government’s intentions in respect of its plans. “We were not aware in advance of plans for another state-owned generation company,” he said. The Daily Maverick interview was republished in Fin24.

“We obviously need to understand the extent to which this statement indicates a change in government policy,” said De Ruyter. He added that Eskom was not “… in principle averse to anyone else investing in electricity generation”. Competition would benefit the country’s economy and improve efficiency, he said.

Mantashe said at the Mining Indaba conference in Cape Town that government would soon open discussions with private investors regarding the creation of a state-owned firm that would compete with Eskom in power generation.

“By this time next year we hope we can say we have a site for energy generation outside of Eskom,” said Mantashe. “We want people to sell energy through transmission … We want to take the pressure off of Eskom,” he said.

Mantashe provided scant details, however, leaving mining industry attendees at the Mining Indaba conference scratching their heads as to why Mantashe had mooted the idea when there was the option of liberalising the electricity market in other ways, such as allowing the licensing of independent power production.