South Africa’s state power utility Eskom has put a clear maintenance plan in place to avoid unexpected electricity supply disruptions, the country’s Deputy President has said

In a written response on Thursday to questions in Parliament, David Mabuza said the government had taken a view that the struggling company – which has been forced to implement rolling power blackouts in recent years to avoid tripping the national grid as it failed not meet demand – must be supported to implement a comprehensive turnaround.

“Eskom is central to the country’s plans of re-igniting the economy in the context of the prevailing negative impact of Covid-19,” Mabuza said, referring to the global coronavirus pandemic which has seen 118 375 people in South Africa infected to date, with 2 292 of them dying as a result.

He said the support largely focused on ensuring that Eskom strengthened its leadership, governance and accountability systems, addressed its debt and liquidity challenges and implemented an effective plant maintenance programme to minimise disruptions in energy supply.

Focus on delivering additional capacity

It also focused on accelerating the completion of a new build programme to deliver additional energy capacity and fast-tracking the emergency procurement of additional energy generation through independent power producers.

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“There is visible progress in addressing key challenges to ensure that the organisation is transformed and put on a new governance and agile operating model,” he said.

“Under the leadership of the new CEO, the re-organisation of Eskom along the lines of a new distinct yet complimentary business and operating model has begun, with clear completion timelines.”

Mabuza said Eskom was also reviewing its head count levels to balance and match business delivery outcomes, core skills and improved organisational performance.

Currently, there were investigations in progress to detect breaches and fraudulent activities across key value chains that were core to the utility’s Eskom operations, he added.

Improving debt collection measures

Eskom, which provides about 95 percent of South Africa’s electricity, was also improving its revenue and debt collection measures to fund its operations and ensure that power was supplied on a sustainable basis.

Mabuza said rising municipal debts posed serious risks to the utility’s long-term financial sustainability and contributed significantly to its liquidity challenges.

“The current municipal arrears debt remains very high, and has reached R28 billion as at 31 March 2020, which is an increase of R8,2 billion over the past 12 months,” he said.

The deputy president said while the electricity system remained under pressure, the government was confident Eskom had put in place the necessary measures to keep the lights on in South Africa.

 

Author: ANA Newswire