Ringfencing revenue for the National Transmission Company South Africa (NTCSA) is regarded as a crucial short-term step for ensuring that the newly operationalised Eskom Holdings subsidiary is placed on a firmer financial footing to begin dealing with the estimated R390-billion grid infrastructure backlog. However, complete financial and operational unbundling from Eskom, together with further tariff reform, is still required to fully derisk the business and position it to play its central role in facilitating South Africa’s transition to an electricity system that does not undermine the country’s export competitiveness as key trading partners begin implementing carbon taxes.
