ABB Signs $75 Million Deal to Upgrade Eskom Grid
Sep 25, 2008 - Business Day/All Africa Global
Johannesburg - Multinational power and automation
technology group ABB has won a $75m contract from
Eskom to supply and install circuit breakers to strengthen
the country's electricity network.
ABB, which is investing R400m in a factory and offices
in SA, is to deliver about 2000 circuit breakers with
operating voltages of 66kV and 132 kV over a five-year
period, and install and commission the equipment.
Circuit breakers help to protect electrical equipment
from damage caused by power surges and will assist
in enhancing the safety and reliability of the electricity
"We are proud to support Eskom in this critical
period of strengthening the power grid," ABB power
products division head Bernhard Jucker said.
"Our production capabilities, together with the
expertise of the local teams that will install and
commission the equipment, helped us secure what is
one of ABB's largest-ever orders for circuit breakers,"
ABB country manager Carlos Po n e said the group
had seen Eskom accelerate projects to upgrade infrastructure
. It would continue to support Eskom on supply and
technical aspects, he said.
With SA facing a serious energy crisis because of
low reserve margins, Eskom has embarked on a R343bn
capacity expansion programme. It includes investment
in coal-fired base-load power stations.
In June, speakers at an electricity distribution
conference warned that the maintenance backlog of
SA's electricity grid would cost about R26bn to fix.
Crucial equipment had fallen into disrepair - threatening
a further power crisis even if Eskom were able to
generate enough power.
Speakers said that underinvestment in ageing infrastructure
could result in a further electricity crisis which
would threaten economic growth.
Eskom has said it could raise up to R150bn during
a five-year period - over and above money obtained
from tariffs and the government.
ABB specialises in power and automation technologies
that enable utility and industry customers to improve
performance while lowering environmental impact.
The ABB Group of companies operates in around 100
countries and employs about 115000 people.
Its order book rose 40% to R7,5bn for the first
six months of this year.
Most of the orders are thanks to Eskom's power infrastructure
spending, but include mining, oil and gas projects
Pone said 40% of the order book came from SA while
the rest was for the continent.
He said the investment in the group's manufacturing
facility, which was to incorporate energy-efficient
building systems, was evidence of the confidence the
Swiss multinational had in SA.