JOHANNESBURG, February 14 – The Infrastructure Research Development Centre (IRDC) said on Thursday it opposed the government’s decision to bring in external engineers to investigate the crisis at state utility Eskom’s power stations.
Public enterprises minister Pravin Gordhan on Wednesday told Parliament that a panel of experts would will be roped in to investigate what caused seven generating units to collapse at the weekend. This led to countrywide rolling blackouts as Eskom started implementing rotational loadshedding.
Engineers from Italian energy company Enel are on their way to South Africa to help sort out Eskom’s maintenance issues. Gordhan said the power utility had suffered a brain drain due to instability and as experienced employees were pushed out.
IRDC executive director Bongani Mankewu said financing decisions must be taken to curb the current dire situation at Eskom, which the government plans to split into three separate entities in a bid to improve its balance sheet and contain runaway costs.
Mankewu said many models could be evaluated, including the pecking order model which has internal financing, debt, and equity as financing options. The model postulates that the cost of financing increases with asymmetric information, which occurs when one party to a transaction has more or superior information to another.
“Lack of this information leads to a premium price of idiosyncratic risk. Now if you bring these pieces together with due consideration of the country’s well-being, ownership of audited information at Eskom is one thing that you cannot afford to let (into) the hands of others,” he said.
“Foreign engineers will not assist in this regard, this will lead to misleading the investment options for the country.”
“Foreign engineers fiddling with our information is not helping Eskom and South Africans, not at all,” he added.
– African News Agency (ANA)