South Africa Eskom’s Reform Shows Results

South Africa Eskom’s Reform Shows Results

A plan to reform South Africa state-owned power company Eskom Holdings SOC Ltd. and provide more electricity to South Africa and its economy is starting to show results, according to recently appointed Chief Executive Officer Brian Molefe. “The strategy is beginning to bear fruit,” he said in an interview at the company’s Johannesburg headquarters Nov. 11.

Bloomberg reported, the company that supplies about 95% of power to Africa’s most-industrialized economy is following a strict maintenance program to avoid managed blackouts. Eskom is struggling to meet demand after decades of underinvestment and delays in completing new plants. While it imposed power cuts on about 100 days earlier in the year, there have been no significant blackouts in the past three months.

The company will ask the regulator for more certainty on the tariffs it can charge and will accelerate its delayed program to build generation capacity, said Molefe, 48.

Eskom has long-term borrowings of about $23.4b, exceeding 99% of the 170 companies in the FTSE/JSE Africa All Share Index, according to data compiled by Bloomberg.

Ratings companies and investors that Molefe met with in London last week hadn’t been aware of some of the progress the utility has made, he said.

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