Cash-strapped Eskom, fresh from being bailed out by the taxpayers, has secured a loan of R9-billion from the World Bank to repurpose its Komati power station in Mpumalanga.
The embattled power producer this week decommissioned the coal-fired Komati station, which has been in operation since 1961, and has now come to the end of its life.
According to Eskom, the power plant’s decommissioning will not have a significant impact on the national grid.
Komati’s mothballing marks the start of the repurposing of coal-fired power stations to renewable energy.
“Reducing greenhouse gas emissions is a difficult challenge worldwide, and particularly in South Africa given the high carbon intensity of the energy sector,” said World Bank Group president David Malpass.
“Closing the Komati plant this week is a good first step towards low carbon development. We are cognisant of the social challenges of the transition, and we are partnering with the government, civil society and unions to create economic opportunities for affected workers and communities.”
Public Enterprises Minister Pravin Gordhan said workers would be supported through a comprehensive transition plan, and that options for them would include transfers to other Eskom facilities, reskilling, and upskilling for deployment to the renewable energy plant.
“This project is part of implementing the country’s Inte-grated Resource Plan 2019, to gradually retire 12 GW of our old and inefficient coal-fired power fleet by 2030 and to scale up private sector-led renewables of 18 GW during the same period.”
Eskom’s appetite for new debt comes after government in the medium-term budget policy statement last week said it would take over between one-third and two-thirds of Eskom’s R400-billion debt.
The move saw Moody’s Investors Service raise its outlook on Eskom’s debt ratings to positive for the first time in 15 years.
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