New model to fund power infrastructure would involve a central loan facility
The Department of Energy is proposing a new model to fund the backlog of electricity infrastructure maintenance and refurbishment, currently estimated at about R70bn. The new model recognises that in the light of the constraints on the fiscus, no additional funding from the Treasury will be forthcoming, and neither are tariff increases an option. The department’s director of electricity supply, Thabang Audat, said in a briefing to Parliament’s energy committee on Tuesday that the maintenance backlog was worsening, and that electricity distributing operators were not addressing it. Electricity distribution infrastructure was on average 40 years old, and a sustainable funding model to maintain and refurbish it was required. Grants from the government to municipalities were not effective as the funds were used for other purposes than maintenance. Such grants were used for social infrastructure. The most practical funding solution was a central loan facility with funds coming from devel...
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