1. Global Power Company of the Year 2001 Proudly South African Broad Based Black Economic Empowerment Programme 31 August 2005

2. Content Background Information Eskom’s BEE Policy objectives Eskom’s BWO Policy objectives Definition of a Black Supplier Definition of a Large Black Empowering Supplier Eskom’s Performance to date Analysis of 2005 BEE Expenditure 2005/06 BEE targets The Future of the BEE Programme within Eskom

3. Background Information Eskom’s Ten Commitments to support the RDP in 1994 In 1995 - Eskom developed and approved a SMME Policy The SMME Policy was aligned to the RDP from a procurement perspective

4. To transform Eskom’s supplier base to reflect the demographics of the country To maximise purchases from Black suppliers To promote entrepreneurship among Previously Disadvantaged Communities To support and promote participation of Black entrepreneurs in the mainstream of economy Eskom’s BEE Policy Objectives

5. To promote entrepreneurship among Black Women To facilitate access of business opportunity for Black Women Forms part of Eskom’s overall BEE policy Key focus for Eskom going forward Black Women Empowerment

6. Definition of a Black Supplier A small supplier qualifies as a Black Supplier when: A minimum of 50% voting shares are held and controlled by Blacks Black shareholders must contribute at least 50 % of the required capital Blacks must participate in the day to day management and decision making of the business

7. Definition of a Large Black Empowering Supplier BEE Supplier Rating Criteria for Supplier and Tender Evaluation CRITERIA 1 2 3 Black Ownership 10% to <20% 20% to 50%  50% Black Management 20% to <35% 35% to 50%  50% Black Skilled Personnel 20% to <35% 35% to 50%  50% Procurement from BEE 10% to <20% 20% to 25%  25 % Black Female Management 1% to < 5% 5% to 10%  10% Other BEE Initiatives One point at Eskom's discretion Employment of the Black Disabled One point at Eskom's discretion ( NOTE ) Large Supplier must score at least one point on Black ownership,Black management, % Black skilled personnel and purchasing from BEE suppliers. When a Large Supplier earns 9 or more points, it is considered a Black or Black Empowering Supplier.

8. Eskom’s Performance to date R’m

9. Analysis of 2005 BEE Expenditure Size of business as per Policy Rand value (R’000) Percentage BEER 6 833.7 million66 % SMMER 2 469.8 million24 % BWOR 996.4 million10 % TotalR 10 300.0 million100 %

10. Based on a % of the budgeted discretionary expenditure 65 % of the budgeted discretionary expenditure Separate target for coal procurement Target for coal is 30 % of budgeted Primary Energy 15 % of overall target for Black Women Owned businesses Eskom’s BEE targets – 2005/06

11. The Future of the BEE programme To encourage and support BEE companies into manufacturing and mining sectors of the economy To drive the economic empowerment of women To target at least 65% of the budgeted discretionary expenditure To support the government objective on BEE

12. E SKOM Thank you.