Project General Description
The project is part of a solution package provided by the African Development Bank to Eskom in response to South Africa’s request for assistance to address its energy crisis. It consists of a senior corporate loan to support Eskom’s 5-year (2015 – 2020) rolling capacity expansion program (CEP). This includes construction and refurbishment of generation and transmission capacity to meet SA’s and regional demand. Eskom Holdings SOC Ltd is a 100% South African state-owned power utility and is the country’s primary electricity supplier. Eskom is also a cornerstone partner to the Southern Africa Power Pool (SAPP), as it trades about 5% of its energy output with neighboring countries. It owns and operates 27 power stations with a net maximum generating capacity of 42 GW. The CEP will enable Eskom to increase its electricity reserve margin, thus reducing reliance on expensive diesel-fired power, while strengthening its network reliability and redundancy, thereby enabling the off-take from renewable energy IPPs. Eskom’s CEP is focused on catalyzing economic growth and job creation in South Africa and the wider region. The CEP is also aimed at restoring SA’s business competitiveness, while improving health (i.e. reducing respiratory deaths/accidents), promoting gender equality (e.g., women spending less time collecting firewood/business opportunities).
The project objective is to assist Eskom to implement its capacity expansion program (CEP), to build energy security in South Africa and the larger region, thus breeding new economic competitiveness in the continent.