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ABB Signs $75 Million Deal to Upgrade Eskom Grid

Sep 25, 2008 - Business Day/All Africa Global Media

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 network.

"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," Jucker said.

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 for Sasol.

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.

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