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AFD and Eskom commit to a competitive electricity sector

Agence Française de Développement (AFD) and Eskom today [Monday, 3 May] signed a Memorandum of Understanding to further affirm their commitment to the promotion and development of a competitive electricity sector.

In the last 14 years, AFD has committed R5.9 billion (EUR 340 million) in loans in support of Eskom projects.

The MOU aims to establish a framework to strengthen the current cooperation and collaboration between the two parties. The agreement also aims to promote the development of a competitive electricity sector, supported by modern technology and low carbon emission.

Eskom, South Africa’s public electricity company, produces around 95% of the country’s electricity, and is in charge of distribution to large customers, in rural areas and in urban areas. 

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AFD and Eskom have JET strategy in mind

In response to global shifts towards liberalised electricity markets and more carbon-efficient energy sources, Eskom has embarked on a restructuring programme to ensure its sustainability and resilience while pursuing a trajectory towards a sustainable, low-carbon future through the Just Energy Transition (JET) strategy.

The AFD and Eskom MOU has the following objectives:

  1. Support for the implementation of the Namaqualand Strengthening Phase 2 project
  2. Support for the implementation of interventions to restructure Eskom’s business model, through a technical cooperation grant
  3. Identify potential collaborations for the energy transition to renewable energy, to mitigate social and environmental impacts, through innovative propositions such as the Just Energy Transition strategy
  4. Support the development of a Just Energy Transition strategy to advance Eskom’s aspiration for a lower carbon, socially inclusive future
  5. Facilitate dialogue between Eskom and strategic stakeholders around the Komati Power Station to consolidate visions on a just energy transition.

Aurélien Lechevallier, Ambassador of France to South Africa, commented: “We have had long-lasting ties with our partner Eskom. We are confident that our close collaboration with Eskom will serve to enhance Eskom’s capacity to find sustainable solutions to the challenges it faces.”

André de Ruyter, the Eskom Group Chief Executive, commented: “The Komati Power Station is amongst those in Eskom’s fleet of older power stations that we hope to use to light up a much brighter and more sustainable future under the Just Energy Transition strategy. In this brighter and more sustainable future of electricity generation, Eskom is encouraged by the continued support and partnership of the French people as represented by His Excellency, Ambassador Aurélien Lechevallier, and AFD. French institutions have always stood beside Eskom at key events in the development of the electricity industry in South Africa.”

Bruno Deprince, AFD’s Regional Director, also commented: “Eskom is a very important long-term partner to AFD, and hence we affirm our commitment to support the public utility’s transformation efforts.”

Nicolette Pombo-van Zyl
As the Editor of ESI Africa, my passion is on sustainability and placing African countries on the international stage. I take a keen interest in the trends shaping the power & water utility market along with the projects and local innovations making headline news. Watch my short weekly video on our YouTube channel ESIAfricaTV and speak with me on what has your attention.