Government will fine-tune electrification programmes amidst R13bn budget - Ramokgopa

MINISTER for Electricity and Energy, Kgosientso Ramokgopa, has said that as only R13 billion had been allocated to the integrated national electrification programme over the medium term expenditure period, the allocation would be used as a de-risking instrument to crowd in developmental capital and concessional finance.

- BANELE GININDZA

Presenting the department's Budget Vote in Parliament on Wednesday, Ramokgopa said the department was working in close partnership with development finance institutions and the National Treasury in developing an infrastructure finance facility that will enable the frontloading of capital requirements through debt market instruments.

"The aim is to mobilise balance sheet financing whilst preserving affordability and fiscal discipline. By using the public allocation as an anchor, the strategy allows for accelerated electricity rollout in high priority provinces and municipalities, greater geographic equity and predictable project pipeline attractive to institutional invetsors," he said.

"The approach positions universal access as a bankable development investment with measurable returns in health, education and economic participation."

Ramokgopa said as Eskom's ability to collect revenue for the services provided continued to decline and municipal debt - currently at just below R100bn after compounding by R3bn a quarter over the past year - the department hoped that the the Distribution Agency Agreement (DAA) being put in place would realise benefits for the sustainability of the entire distribution industry.