HomeRegional NewsSouthern AfricaUS$3.5 billion needed for SA distribution grid

US$3.5 billion needed for SA distribution grid

10 June 2008 – It could cost as much as US$3.5 billion to bring maintenance backlogs to the South African electricity grid up to date it was reported this week.

DistributionContinued underinvestment in maintenance could also cause another electricity crisis and further threaten economic growth, experts have warned.

Speaking at a conference in Johannesburg, minister of minerals and energy, Buyelwa Sonjica said: "The lack of maintenance and refurbishment of the electricity distribution infrastructure poses a threat to our economy.

"It has been a while now that we have been trying to mobilise all parties in the distribution industry to invest in infrastructure," she said, commenting further that the government has invested some US$250 million on new distribution infrastructure.

According to EDI Holdings COO, Willie de Beer, there is a shortfall of approximately US$220 million a year, in what he calls an ‘investment adversive’ approach to infrastructure maintenance.

"To effectively manage the future maintenance and refurbishment requirement, an estimated R2bn (US$270 million) per annum will be required. In general, the current practices in the EDI are no guarantee for business sustainability and economic growth."

He further spoke about the need for ‘urgent structured intervention" in order to prevent a collapse of the industry.