South Africa Bails Out Eskom (Again), but Blackouts Remain Likely
MIN READFeb 22, 2023 | 22:43 GMT
An illuminated Eskom sign is seen outside the power utility's regional office in Johannesburg, South Africa, during load shedding (i.e. a rolling blackout) on Jan. 31, 2023.
(AFP via Getty Images)
Eskom's bailout will likely save the electricity utility from a debt default, but South Africa's blackouts will persist through the next year, sustaining business disruptions and economic losses. During his 2023 budget speech on Feb. 22, South African Finance Minister Enoch Godongwana announced that the country's state-owned power utility Eskom will receive a 254 billion rand ($13.9 billion) government bailout over the next three years, contingent on performance improvements and partial privatization of South Africa's electricity transmission network and coal-fired plants. The bailout will be granted in installments and will draw on 66 billion rand (about $3.6 billion) of funding provisions made during the October 2022 midterm budget and require an additional 188 billion rand (about $10 billion) in borrowing by the government. According to Godongwana, an international panel of energy experts will determine which of Eskom's failing coal-fired electricity plants can be rehabilitated by mid-2023, after which Eskom will...