Restructuring the South African electricity supply industry

Bibliography: leaves 94-98.In a post-apartheid South Africa, the electricity supply industry (ESI) will be under pressure to make up the backlog in electricity provision to poor households. Simultaneously, it will have to protect its financial viability in order to maintain a low-cost electricity supply to support a growing economy. This study analyses the current structure and governance of the ESI and proposes a significant restructuring to enable these challenges to be met. It is argued that the highly fragmented distribution sector of the ESI should be rationalised, and that the industry should remain in the public sector. Questions around the governance and regulation of the ESI are identified as critical to the future performance of the industry. By drawing on international experience, a distinction is made between the roles of politics and technical expertise in the governance of the ESL On the basis of this distinction, a new governance model is developed, which is based on a contract-plan mechanism, but which relies on the role of stakeholders and an independent regulator. In this way, this thesis attempts to establish in the governance system an appropriate balance between the equity concerns of a new democratic government, and the efficiency needs of a developing economy