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Eskom Misses Key Performance Target Amidst Energy Crisis

Published April 03, 2024
11 months ago


Eskom, South Africa's primary electricity supplier, has grappled with a significant setback as it fails to achieve its government-imposed performance goal of reaching a 65% Energy Availability Factor (EAF) by March 2024. The recent reports reveal a bleak 52.37% average EAF in the initial 12 weeks of the year, which indicates a decrease from the previous year — a concerning trend that raises questions about the utility's management and strategic direction.


Initial optimism was cast into doubt when the Eskom board, appointed in October 2022, missed their significant target, a benchmark intended to mark a turnaround for the beleaguered power entity. The progressive target eyed an increase to 70% by March 2025; however, such plans now seem elusive. The failure to elevate the EAF not only dims hopes for consistent electricity supply but also underscores the broader challenges that Eskom and the South African government face in the energy sector.


Critics and experts, noting the downward trend in EAF over the past five years, have expressed skepticism about the realism of these goals. They point out that operational matters, often cited as board responsibilities, ignore critical structural and policy issues beyond their control.


Grant Pattison, a seasoned executive with a history in South African corporate governance, critically underscored the limitations faced by the board, highlighting that much authority lies beyond their purview. The government wields considerable influence over Eskom's operational autonomy, constraining the ability of the board to enact sweeping changes.


The former chair of Eskom's board, Mpho Makwana, resigned less than a year into the role — a departure that coincided with reporting on internal disagreements and hinted at the difficulties in achieving set objectives. Makwana’s successor, Mteto Nyati, faces the unenviable task of steering the utility under the weight of pre-existing targets and ongoing scrutiny.


Despite these challenges, spokesperson Daphne Mokwena maintained that Eskom aimed to meet the original EAF target. Meanwhile, Nersa's tariff determinations were predicated on an optimistic EAF assumption of 64.8%, potentially upsetting fiscal projections and necessitating increased spending on alternative, costly measures such as diesel for gas turbines to mitigate load-shedding.


This missed target is more than a mere statistic; it signifies the lapses and constraints in South Africa's drive for a resilient and reliable energy sector. With Eskom's efforts falling short, the ripple effects threaten economic stability, investor confidence, and the daily lives of millions of South Africans.



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