Company Information

Nature of business, major products and services

Background

Eskom was established in South Africa in 1923 as the Electricity Supply Commission. In July 2002, it was converted into a public, limited liability company, wholly owned by government.

Eskom is one of the top 20 utilities in the world by generation capacity (net maximum self-generated capacity: 41 194MW). Eskom generates approximately 95% of the electricity used in South Africa and approximately 45% of the electricity used in Africa. Eskom directly provides electricity to about 45% of all end-users in South Africa. The other 55% is resold by redistributors (including municipalities).

Value chain of Eskom

Capital programme

Additional power stations and major power lines are being built to meet South Africa’s rising demand for electricity. In 2005, Eskom embarked on a capacity expansion programme, the largest in its history, which will increase its generation capacity by 17 120MW and its transmission lines by 4 700km. The capacity expansion programme aims to both meet increasing demand and to diversify Eskom’s energy sources. In the six years ended 31 March 2011, the programme has cost R140 billion (including capitalised interest). The total cost of the programme to completion in 2018 is estimated to be R340 billion (excluding capitalised interest).

Eskom has approved and committed to:

• Building the Medupi and Kusile coal-fired power stations, two new gas-turbine plants, and the Ingula pumped storage plant
• Recommissioning three coal-fired plants that were previously mothballed
• Upgrading other existing plants
• Building new infrastructure, including new transmission lines and two renewable energy plants.

The completion of the Kusile power station in 2017/18 will constitute the last stage of Eskom’s committed capacity expansion programme. There has been no approval or commitment to any capacity expansion projects after that.

Eskom in Africa

While most of Eskom’s business is within South Africa, the company also buys and sells electricity in the SADC region. Eskom’s involvement in African markets beyond South Africa is currently focused on projects that have a direct impact on ensuring a secure supply of electricity for South Africa itself. Eskom is investigating additional opportunities in the SADC region.

Eskom Enterprises SOC Limited has two subsidiaries, Rotek Industries SOC Limited and Roshcon SOC Limited, with an interest in electricity operation and maintenance concessions in Mali, Senegal, Mauritania and Uganda.

1.Southern African Development Community countries connected to the South African grid, and countries in the rest of Africa.

2.Originally under the Electricity Act (41 of 1987) and more recently under the Electricity Regulation Act (4 of 2006).

3.Under the National Nuclear Regulatory Act (47 of 1999).