Cyril Ramaphosa calls on Brian Dames to help rescue Eskom - and he wants a plan soon
President Cyril Ramaphosa has appointed an eight-person Eskom Sustainability Task Team to advise government on actions to resolve the power utility's operational, structural and financial problems.
"This high-level task team consists of individuals with extensive electricity, management and economic expertise," the presidency said in a statement on Friday evening.
Ramaphosa has appointed former Eskom CEO Brian Dames and ex-Eskom chief financial officer Mick Davis to the task team, alongside Anton Eberhard, Tsakani Mthombeni, Sy Gourrah, Grové Steyn, Frans Baleni and Busisiwe Vilakazi.
"Appreciating the urgency of the matter," Ramaphosa has requested the task team to submit initial recommendations by the end of January 2019.
The task team is to:
• Assess the operational, structural and financial viability of Eskom, including key assumptions regarding the life of the plant, the effect and cost of environment commitments, and demand.
• Review the turnaround strategy submitted by the Eskom board. This will include a review of key assumptions, effect on tariffs and industry, and the viability of proposed solutions on the future role of Eskom.
• Assess the appropriateness of the current Eskom business model and structure.
• Present a view on the current energy trends and the evolution of the global energy context.
• Present a view on the role, positioning and structure of energy utilities and provide proposals.
• Propose alternative business and financial models appropriate for the South African context.
• Propose how the structure of the electricity industry in South Africa can adapt to changes in this sector, including the harnessing of new technologies.
• Make proposals to resolve the debt burden.
The task team is mandated to consult various roleplayers including labour and business.
"The assessments that will be carried out by the task team arise from government’s concern that the lack of adequate electricity has a negative impact on economic recovery and that there is a need for intervention in the short and medium term, to restore the supply-demand balance," said Ramaphosa's office.
"This is coupled with severe financial constraints at Eskom, which impact on the fiscus, and where operational and financial issues have become inter-related and need to be addressed simultaneously."
The president said Eskom's board and management team, as well as the department of public enterprises, will work with the task team.
Energy expert Chris Yelland commented via Twitter, saying: "A powerful task team indeed that gives some idea of the future direction for the restructuring of Eskom and the electricity supply industry."
Davis is a former chief financial officer at Eskom while Professor Eberhard has worked in the energy sector across Sub-Saharan Africa, and other developing regions, for over 35 years. At the University of Cape Town, he directs the Managing Infrastructure Investment Reform Regulation In Africa (Mira) unit at the Graduate School of Business.
Dr Mthombeni is a energy and carbon executive at Goldfields, and, importantly, chairman of the Energy Intensive User Group - which are Eskom's biggest customers: South Africa's large industries.
Sharing brief CVs of the other team members, Yelland said Dr Steyn is an infrastructure and regulatory economist, and director at Meridian Economics.
Dr Vilakazi is a senior researcher at the Council for Scientific and Industrial Research, with an MSc in engineering from Wits, and PhD in biomedical engineering as a Nelson Mandela Scholar from the University of Oxford in the United Kingdom.
Baleni is deputy chairperson of the Development Bank of Southern Africa (DBSA) and former secretary-general at the National Union of Mineworkers (NUM).
Gourrah is a former city electrical engineer of Buffalo City, former president of the Association of Municipal Electricity Utilities of Southern Africa (AMEU), and general manager: power systems at Actom.