S Africa defends handling of Eskom crisis

South Africa’s public enterprise minister has strongly defended the government’s handling of the management crisis at Eskom, the beleaguered state-owned power utility, and said plans to secure extra funding – including possible equity injections from investors – for much-needed new generation capacity are under consideration.

Barbara Hogan also said that she hoped to find replacements for the company’s former chief executive, Jacob Maroga, and chairman, Bobby Godsell, within the next three months, or “an even shorter period if possible”.

Both men resigned over the past month, with Mr Godsell, a prominent white businessman, arguing the government had not backed his board’s decision to hold Mr Maroga to a resignation offer he made last month.

The affair, which has seen acting management in charge at Eskom, raised concern about its ability to meet future demand for electricity, reviving memories of the black-outs of the first half of last year.

Ms Hogan also implicitly criticised government allies such as the African National Congress Youth League, which had argued that the moves to oust Mr Maroga, a black engineer, were racist.

“What disturbs me is when people use political connections to in effect almost run a political campaign to secure their positions,” Ms Hogan told the Financial Times. “I think that is when you politicise the boardroom.”

She added that a similar kind of “politicisation” of “transformation” [the process of economic empowerment of the majority black population] had held up the appointment of top executives at Transnet, the state operator of South Africa’s roads, railways and ports, whose affairs are also part of the minister’s portfolio.

However, Ms Hogan believed its acting executives were “managing excellently. I don’t have concerns and I don’t want a chief executive to come in who will be contested.“

She added the government was pressing ahead with plans to build new electricity generation capacity. A coal-fired power station at Medupi would come on stream in 2012 and a second facility at Kusile would follow. Nuclear power was also part of government plans. “We want to double the electricity supply in 20 years,” Ms Hogan said.

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