State-owned enterprise (SoE) Eskom is expected to sign cogeneration contracts within the next month and will seek to source up to 1 143 MW from such sources, Public Enterprises Minister Barbara Hogan said on Monday.

Addressing a media briefing in Cape Town, Hogan said that Eskom could no longer be regarded as the country's single power producer and it had become essential to supplement Eskom's energy supply through cogeneration agreements, as well as through the involvement of independent power producers (IPPs).

Hogan elaborated that the anticipated cogeneration deals could include partners such as petrochemicals group Sasol, the world's biggest coal-to-fuel producer, and the world's biggest producer of fine paper, Sappi.

Sappi and other potential producers have been participating in various bidding processes announced by the government, which have, to date, not borne any fruit.

While Hogan was somewhat vague on the timing of the finalisation of the contracts, she insisted that an agreement would be reached within the month.

Hogan added that the recent Nersa tariff ruling, which approved a 24,8% Eskom tariff increase, included the additional costs required for cogeneration projects.

The announcement was made amid growing concern over the country's future energy security.

South Africa faced a future 40 000-MW shortfall, which would have to be created by 2025 if it was going to meet its energy requirements.

Meanwhile, Hogan confirmed that a performance review of South Africa's SoEs was currently under way.

The investigation was initiated last month following the establishment of a joint Ministerial committee, driven by Hogan and Finance Minister Pravin Gordhan, to review SoEs and get them aligned with the priorities of the government.

Hogan briefly told the media at a press conference in Cape Town that the review would examine the financial performance, governance and overall performance of SoEs.

The review would also include an investigation into the funding of parastatals.

It is believed that the review would particularly focus on the performances of Transnet, South African Airways, Eskom, SA Express, the Pebble Bed Modular Reactor, Alexkor, Denel, the SABC, the Post Office and Sentech.

Once the review had been completed, the Department of Public Enterprises would make recommendations to Cabinet based on its findings.

However, Hogan stated that the review would not replace ongoing shareholder responsibilities.

Hogan would not commit to a timeframe for the review process.