Firstly, excuse my grade two question but... Couldn't Eskom just issue bonds to raise cash for their mismanagement, rather than to hike up the electricity rates? They're big enough, they could get their bonds rated by some ratings agency and they're backed by the government...
Eskom's bonds are guaranteed by the state and therefore AAA-rated. As debt instruments, they carry an interest coupon and given the extent of their build programme (Medupi +R200bn and Kusile R120bn), interest- and debt coverage ratios have to remain within reasonable parameters to maintain creditworthiness. So, the ideal and sustainable lt funding structure will probably be a combination of higher tariffs, debt and a possible injection of capital by the state. Private sector investors will now hopefully also be enticed to invest in generation capacity. That said, the whole saga smacks of incompetence, gross mismanagement and lethargy. Indeed, another national disgrace.
Question is, will IPSA be included in the Private supply to Eskom? Or, as Municipalities cannot pass on the total icrease will any Municipality be in the market for one of their turbines? Or, am I just dof as I have no idea what price they can generate electricity at.... IPS trading at R1.20
EXX is investigating the possibilty of putting up a windfarm here in the Western Cape. They have requested permission to proceed with the study. These "okes" are moving into the electricity selling business!