South Africa - Eskom Transmission Improvement Project - Loan


Project Summary

Approval Date 25 Sep 2018
Signature Date 27 Nov 2018
Planned Completion Date 30 Jun 2022
Sovereign / Non-Sovereign Sovereign
Sector Power
DAC Sector Code 23630
Environmental Category 1
Commitment U.A 122,555,576.79
Status Implementation

Project General Description

The Transmission Improvement Project in South Africa follows a request for funding received from Eskom in 2015 to the tune of ZAR 15 billion to finance its capital expansion programme. In response, in December 2015, the Bank approved a USD 375 million under the non-sovereign window. The project will construct 436km of 400Kv and 116km of 132Kv transmission lines and upgrade substation equipment at four substations which will provide additional evacuation paths for electricity from Kusile, Majuba, Drakensburg and Ingula power stations. The intervention will therefore not only part finance the critical transmission programme but also provide an opportunity for the Bank to continue engagements with Eskom, the Government and the regulator on improvements to the corporate governance environment, the continued roll out of the renewable energy independent power producer procurement programme and a sustainable electricity tariff path for the sector. Its implementation will thus contribute to the Eskom electricity connection target of one million customers by March 2021 and increased power exports into the region.

Project Objectives

The project comprises the construction of transmission lines and the rehabilitation of substations in Mpumalanga and Kwazulu-Natal (KZN) provinces. The lines are required to (i) provide additional power evacuation paths for new generation capacity, (ii) ensure the availability of capacity for future load growth, (iii) reduction of network losses; and (iv) safety during network operations to ensure compliance to the Grid Code. The outcome is increased availability of electricity supply and improved efficiency of the power transmission system through a reduction in the level of technical losses.

Beneficiaries

The project output will thus benefit all electricity customers connected to the grid in South Africa and the region but will mainly benefit the Cape and Kwazulu-Natal regions, as the project creates additional power evacuation paths for power generated in Mpumalanga and Drakensburg areas, respectively. As of 2015, the Cape and KZN provinces accounted for 46 percent of the South African population at just over 24.7 million (51 percent female and 49 percent male).

Participating Organization

Funding
African Development Bank
Implementing
ESKOM HOLDINGS LTD (Public Sector client)

Information

IATI identifier 46002-P-ZA-FA0-003
Last Update 22 Nov 2020

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Contact Details

Name MOLEPO Seaga Abram
Email s.molepo@afdb.org

Geographic Location

Country South Africa