On Wednesday night this week only one of Eskom’s 17 power stations was operating at full capacity. That’s not even the scariest part.
That power station, Komati, is 60 years old and produces only 1% of SA’s electricity needs. Located between Bethal and Middelburg in Mpumalanga, it generates a mere 115MW for the grid.
The figures make sober reading. Only 10 of Eskom’s stations, including Lethabo (95% of 3,558MW capacity), Kusile (76% of 2,142MW), Matimba (89% of 3,690MW), and Arnot (50% of 2,100MW), were running at 50% capacity or better.
The worst-performing stations were Majuba, with four available units, and Tutuka, with six, both of which produced 41% of their design output.
This was the horror situation as the country slid into the grip of winter and, with it, the ninth day of stage 2 load-shedding since the start of the new financial year in April.
The total supply shortfall on Wednesday evening was 4,329MW. These “partial load losses”, to use Eskom-speak, are the main element of unplanned outages.
Eskom spokesperson Sikonathi Mantshantsha says these shortfalls are unavoidable. The reasons are “many and diverse” and include factors such as “lower than ideal coal quality” and “high ambient temperatures”.
A snapshot of the crisis this week showed that Eskom is still unable to contain unplanned plant failures.
- Kendal’s unit 5, which environmental affairs minister Barbara Creecy ordered must be shut down because it exceeded emissions limits, was meant to be brought into compliance and returned to service two months ago. But then Kendal’s unit 6 also had to be shut down in a planned outage, and did not restart last week as Eskom had hoped; and
- Delays around the commissioning of additional units at new stations Medupi and Kusile, caused by design defects and corruption, still dog the power utility. Teams are finalising test runs at Medupi’s last unit and hope to bring it online in the coming weeks. Kusile’s three remaining units should start coming online from next year until 2023.
Eskom on Friday suspended the manager of Koeberg nuclear power station over the delayed return to service of one of the station’s two units, which resulted in 930MW of power being unavailable.
The unit shut down in January and should have restarted last month, but this will now only happen later this month.
Eskom CEO André de Ruyter once again apologised to South Africans for load-shedding, and said that despite small wins such as progress at Medupi, implementation of long-term maintenance of the ageing fleet and an increase in the number of renewable energy projects in the pipeline, power outages would not go away in the near future.
“When I assumed my role in January of last year, we communicated that during the so-called reliability maintenance recovery programme, there would be an increase in the risk of load-shedding while we do this maintenance, and unfortunately those risks have now materialised,” he said on radio station 702 this week.
“In addition to that, we need to acknowledge that our plants are old. They have not been well looked after. Our plants, when we exclude Medupi and Kusile … have an average age of in excess of 40 years, and it’s been a hard 40 years …
It’s a bit like a car that you haven’t maintained properly … Now that it’s breaking down, you really have to do a lot of work in order to catch up
“So it’s a bit like a car that you haven’t maintained properly, that you’ve revved in the red on a continuous basis. And now that it’s breaking down, you really have to do a lot of work in order to catch up,” De Ruyter said.
“Can we do a better job? Can we do a faster job? My COO [Jan Oberholzer] and I are pushing the organisation as hard as we can. People are working extraordinary hours to bring units back. But we simply cannot perform miracles overnight,” he said.
Since arriving at Eskom more than a year ago, De Ruyter has had to revise several public statements forecasting the end of load-shedding.
To be fair to him, the problem began nearly 15 years ago and he’s not the first CEO to experience just how fast-changing and unpredictable the Eskom system can be.
He has inherited an organisation that has not only been eaten away from inside by endemic corruption, but has been hobbled by government policy indecision and is regretting its failure to heed crucial advice decades ago.
Political interference, such as the intervention in wage negotiations three years ago by the minister of public enterprises, Pravin Gordhan, has not helped.
The then CEO Phakamani Hadebe, fully aware of Eskom’s precarious financial situation, informed unions that the utility simply could not afford an increase. Gordhan and the then Eskom board chair Jabu Mabuza overruled him and signed a deal with unions that gave them a 7.5% rise.
Another example, as noted by Daily Maverick columnist Stephen Grootes, is that while Eskom’s output has dropped since 2008 when load-shedding started, the number of employees has soared to about 44,000 now from 32,000 in 2003.
Political interference, such as the intervention in wage negotiations three years ago by the minister of public enterprises, Pravin Gordhan, has not helped.
De Ruyter is standing his ground in this round of wage negotiations, with support from his board and the shareholder.
He has offered labour a 1.5% increase, conditional on workers accepting a restructuring of their benefits, but unions have rejected this and are pushing for hikes of between 9.6% and 15%. The dispute is now going to the Commission for Conciliation, Mediation and Arbitration.
The extent of the corruption at Eskom becomes clearer every day as investigations lay bare the looting of hundreds of millions of rands by senior managers in the building of Kusile. The managers, some of whom already face criminal charges, used the money to buy cars, palatial homes and academic qualifications, among other things. Some money even found its way to a foundation started by one of Jacob Zuma’s fiancées.
In 2019 it was revealed that Eskom would lose up to R10bn over six years through inefficient coal supply contracting — it paid different prices to different suppliers for the same grade of coal. All this comes on top of the billions lost to corruption involving the Guptas and their associates.
Despite the gloom and darkness, Eskom continues to work towards a turnaround. Last month Gordhan, in his department’s policy speech, said the utility — with the help of a government bailout of R69bn over the past three years — had reduced its debt by R83bn to R401bn.
Other wins over the past couple of years include the repayment by global consultancy McKinsey of R1bn in irregular receipts, R1.57bn returned by engineering company ABB and R171m repaid by Deloitte.
Eskom is also claiming a further R3.8bn from several former Eskom executives and board members, and is in the process of instituting liquidation proceedings against the Gupta-linked company Trillian to recover R600m wrongly paid to it as part of state-capture looting.
The company has also dismissed and laid criminal complaints against scores of employees found to have been involved in corruption.
On the operational front, the company has acted against the managers of underperforming stations in a bid to improve efficiency. “All incidents that result in unplanned outages are investigated and actions taken to address root and contributory causes of each incident,” Mantshantsha said.
Several Eskom insiders said this inadvertently contributed to load-shedding because station managers were too afraid to take decisions out of fear of being “dealt with”.
“One could say there’s a climate of fear, but it’s more inaction,” said one insider.
“Since we’ve come out of the days of state capture … there was a time when people were basically driven out just because it was thought [they were] part of the state capture regime.
“Right now, if anything goes wrong at your station, they accuse you of being against the new regime and move you without any reason,” said the source, who asked not to be named as speaking out could cost him his job.
The insider said Duvha and Tutuka power stations, identified as particularly problematic by Oberholzer, had both had six different station managers in the past three years.
Mantshantsha said although surveys of staff morale have not found significant issues, management is aware of anecdotal evidence of unhappiness.
He attributes this to the tough jobs that “guardians” — the term Eskom workers use to refer to themselves — have to do to keep the lights on. “This is not surprising considering the extremely difficult working conditions of station staff, exacerbated by the pandemic,” Mantshantsha said.
Eskom may be overstaffed in some areas, but in many key functions there is a serious shortage of skilled, experienced staff
“Although Eskom may be overstaffed in some areas, in many key production-related functions there is a serious shortage of skilled, experienced staff, putting enormous strain on those executing the work,” he said.
“This is exacerbated by the dire financial situation Eskom finds itself in, including years of no increases or bonuses for nonbargaining-unit staff.”
De Ruyter has also had to deal with allegations of abuse of power and with irregular appointments by former senior Eskom executives. But he has the unwavering support of his board and Gordhan, the shareholder representative. Both say criticism of the CEO are related to his efforts to turn Eskom around and purge the corruption.
In the past fortnight De Ruyter has been vindicated in his row with former chief procurement officer Solly Tshitangano.
An independent disciplinary hearing chaired by senior counsel Nazeer Cassim recommended that Tshitangano be fired for nonperformance, and this week another advocate, Ishmael Semenya, rejected a litany of complaints by Tshitangano against De Ruyter — which included charges of racism and improperly made appointments — as without merit.
De Ruyter also has broad public backing in his quest to rid Eskom of the rot that has incapacitated it for all these years. But that goodwill sometimes seems to hang by a thread.
For the second time this year the power utility announced it would temporarily suspend load-shedding to allow for a virtual sitting of parliament that was scheduled to pass a series of appropriation bills. This was after a request from the speaker of parliament, Eskom said in a media statement.
South Africans reacted with anger on social networks, questioning where Eskom found the capacity to be able to temporarily suspend load-shedding at will.
Power to the people? It seems this is not always the case.
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