Economic development

Eskom will soon be irrelevant, says Remgro chief

A different view of Eskom was given this week by Jannie Durand, CEO of South Africa’s largest private investment company Remgro.

Eskom would be irrelevant within five years, Durand said in a radio interview after the release of Remgro’s interim results.

He predicted that the private sector would take over most electricity generation and distribution. This was the way to go for all of South Africa’s state owned enterprises, he said, and “should be done more and more”.

He pointed to the successes and benefits of the effective privatisation of the telecoms industry in South Africa in the 1990s and 2000s.

Remgro is fulfilling part of Durand’s prediction. The company has launched an energy exchange which is to start selling affordable wind and solar power to South African businesses in June this year.

“We can actually now buy power in Mpumalanga and sell it in the Western Cape using the Eskom grid. Also what is quite compelling is we can get price certainty to the consumer,” Durand said.

“We will mainly be trading in green energy, prices are very constant, and obviously nobody can steal wind and sun so that makes it a lot easier.”

Increased competition would benefit consumers, especially if there was further deregulation of electricity supply.

“I’m firmly of the opinion that in five years’ time Eskom will become irrelevant and it will be done mostly by the private sector,” Durand stated.