By Johnathan Paoli
The National Council of Provinces (NCOP) has officially approved the Eskom Debt Relief Amendment Bill, marking a critical step in South Africa’s ongoing efforts to restructure and stabilise the beleaguered state-owned power utility.
Presenting the Bill to the NCOP, Chairperson of the Select Committee on Appropriations, Tidimalo Legwase, explained that the adjustment reflected the Treasury’s evolving fiscal approach toward Eskom and aimed to balance support for the utility with increased accountability.
“Firstly, the Bill reduces the direct allocation for 2025/26. Secondly, it converts the entire amount into a loan, which is subject to conditions. Lastly, it introduces an additional allocation for 2028/29,” Legwase said.
The Bill passed with 56 votes in favour and 10 against, with no abstentions.
The amendment forms part of the broader R230 billion Eskom debt relief framework adopted in 2023.
It significantly adjusts the debt support allocated for the 2025/26 financial year, doubling it from R40 billion to R80.2 billion, and introduces a further R10 billion allocation in 2028/29.
It also converts the 2025/26 allocation into a conditional loan, rather than a direct transfer.
To date, R140 billion of the original R230 billion package has been disbursed.
However, this figure is R40 billion below initial projections due to Eskom’s failure to meet a key condition, which is the disposal of its finance subsidiary, Eskom Finance Company.
Legwase said the Treasury has now agreed that the debt relief be converted into government equity over time, thereby reducing pressure on the state’s gross borrowing requirements while maintaining control and oversight of public funds.
The committee also urged the Treasury to establish clear performance indicators, increase transparency on the loan-to-equity conversion process, and align the restructuring with South Africa’s Just Energy Transition goals.
The African National Congress (ANC), which supported the Bill, said it was a crucial lifeline for Eskom and a necessary intervention to avoid a sovereign debt crisis, given the government’s loan guarantees.
The ANC’s Bhekizizwe Radebe argued that the relief package was already delivering results.
“This Bill has enabled the revitalisation of Eskom through access to free cash resources. It has facilitated maintenance of the coal fleet and refurbishment of key power plants. We have now gone over 300 days without load-shedding,” Radebe said.
He added that the debt relief was supporting Eskom’s unbundling into three entities of generation, transmission and distribution, as well as unlocking new transmission capacity, especially for renewable energy.
The Economic Freedom Fighters (EFF) led the opposition, expressing deep concern over the structure and objectives of the relief programme.
EFF MP Mathapelo Siwisa condemned what she described as a “lender-first” strategy that failed to benefit struggling South Africans.
“We reject the strict conditions set by the government on Eskom because they prioritise the interests of lenders over the needs of our people. Electricity must not be produced for profit, but for the development and livelihood of our people,” Siwisa said.
Siwisa also called for the cancellation of all Independent Power Producer agreements, claiming they amounted to theft of Eskom funds.
Instead, she advocated for a coal-based, state-led generation strategy.
Last week, during the National Assembly debate, EFF MP Nazier Paulsen echoed similar sentiments, accusing the ANC-DA alliance of enabling corruption and inflated tenders while ordinary citizens paid unaffordable electricity prices.
The Freedom Front Plus and other smaller opposition parties also opposed the Bill, citing affordability, structural flaws in Eskom’s model and the lack of immediate relief for low-income households burdened by municipal energy debt.
While the amendment Bill passed without changes, the Select Committee on Appropriations recommended that the Treasury and Eskom provide regular progress reports to Parliament, including how funds are used and whether Eskom is meeting the restructuring milestones.
The committee also called for greater consultation with affected communities, energy experts and civil society in shaping future energy and fiscal strategies.
Legwase stressed that public money must be spent transparently and in line with both national development priorities and global climate obligations.
The Bill will now be submitted to President Cyril Ramaphosa for assent.
Once signed into law, Treasury will begin implementing the new funding structure and disbursing the adjusted allocations.
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