Eskom: South Africa's fallen energy giant

Eskom: South Africa's fallen energy giant

Many South Africans are furious at the blackouts, which can last hours at a time
Many South Africans are furious at the blackouts, which can last hours at a time. Photo: Phill Magakoe / AFP
Source: AFP

PAY ATTENTION: Celebrate South African innovators, leaders and trailblazers with us! Click to check out Women of Wonder 2022 by Briefly News!

It was once a source of national pride -- an award-winning firm that powered South Africa's mining boom and later brought electricity to black communities left behind by apartheid.

Today, a hundred years after its birth, Eskom has experienced a spectacular fall from grace.

South Africa's energy giant is crippled by debt, beset by corruption scandals and unable to keep the lights on.

Families and businesses are exasperated by the record power cuts imposed by the utility, which provides about 90 percent of the country's electricity.

"To South Africans today, (Eskom) represents a source of enormous frustration and ridicule," said Kyle Cowan, author of "Sabotage," a book detailing Eskom's troubles.

A tweet Wednesday to mark the corporation's centenary summed up the bitter mood.

PAY ATTENTION: Follow us on Instagram - get the most important news directly in your favourite app!

Read also

Europe's top prosecutor sets sights on Russia sanctions-busters

"We hope you enjoy the cake we made for you," it said, accompanied by a picture of a bowl of raw cake batter -- uncooked because of the blackouts.

Eskom prides itself on its long history, which is closely intertwined with that of modern South Africa.

Its website reminds readers how "the good townspeople of Kimberley," a diamond mining hotspot, were in 1882 among the first in the world to get electric street lights -- even managing "to beat London to it".

Eskom was set up on March 1 1923 as the Electricity Supply Commission (ESCOM), tasked with boosting industry and mining activities.

Gold had been found where Johannesburg would sprung up, and mines required a lot of power to run.

Coal rush

Coal-fired stations started popping up across the country and grew bigger and more plentiful through the decades.

Yet there was a catch.

All this largely benefited white people, with black South Africans segregated and disregarded by the apartheid government.

Read also

Internet access, privacy 'essential for freedom': Proton chief

In 1987 only 40 percent of the population had access to electricity.

The first democratic elections in 1994 were followed by a push to electrify millions of homes, and keep electricity prices low.

The mammoth effort even won Eskom an award in 2001.

But it was not backed by additional capacity, something that laid the foundations for today's troubles, Cowan said.

Eskom is struggling with rundown coal-fired plants which require repairs and hefty maintenance
Eskom is struggling with rundown coal-fired plants which require repairs and hefty maintenance. Photo: GUILLEM SARTORIO / AFP
Source: AFP

Most of the power stations are older than 45 years, and break down frequently leaving South Africans without lights for up to 12 hours each day.

"Eskom has basically been mismanaged into the ground," said Cowan.

Finance Minister Enoch Godongwana admitted Eskom's woes, highlighting to AFP "the debt situation, which is making it difficult to move with speed, in particular upgrading their plants."

In 1998, a government paper warned the country risked running out of electricity within a decade unless new plants were built.

But the advice was left unheeded until the last minute, something ex-president Thabo Mbeki would later apologise for.

Read also

Asian markets mixed as US rate saga plays against China reopening

'Cyanide'

Eskom began building two new coal-powered stations only in 2007, the year power cuts were first imposed.

But the new plants suffered from commissioning delays, design and construction problems, massive cost overruns and allegations of graft.

Under Jacob Zuma's presidency, Eskom found itself at the centre of a massive corruption scandal.

Millions of dollars were allegedly syphoned off through fraudulent contracts in return for bribes.

Last year, an ex-CEO was arrested for money laundering and fraud.

In February, the firm's outgoing chief Andre de Ruyter compared corruption at Eskom to a cancer that had "metastasised" and "grown throughout the entire body of the organisation."

In one egregious case, the company had been paying 80,000-rand ($4,300) a piece for knee guards sold in retail stores at $16, he said.

Attempts to clean up the firm faced fierce internal resistance, he told local broadcaster eNCA, adding he suffered a poisoning attempt in December, drinking coffee laced with cyanide.

Read also

Clones, noseprints, flying taxis: Sci-fi meets reality at expo

Hours after the interview, in which he accused the ruling ANC party of being involved in the wrongdoing, he was asked to leave his post prematurely.

Eskom has had more than a dozen CEOs in the past 15 years.

"Corruption is not the reason why the energy crisis started, but it's a big reason why it is still not solved," said Roula Inglesi-Lotz, a University of Pretoria economics professor.

Eskom is intertwined with the South African coal industry, which employs nearly 100,000 people
Eskom is intertwined with the South African coal industry, which employs nearly 100,000 people. Photo: LUCA SOLA / AFP
Source: AFP

Meanwhile government policies aimed at protecting the country's coal industry, which employs almost 100,000 people, stymied the roll out of renewables.

A licensing threshold for private power generation projects was removed only last year.

Trade unions have pushed back against plans to boost private investment in green energy and break up the monopoly into separate divisions for generation, transmission and distribution.

Eskom employs over 30,000 workers.

President Cyril Ramaphosa recently announced a national state of disaster in a bid to tackle the energy crisis.

Read also

Musk eyes torrid growth at Tesla, but offers no big new reveals

Many South Africans who hope this could help bring some relief, might be in for a disappointment.

"There are no quick fixes," said Inglesi-Lotz.

PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ click on “Recommended for you” and enjoy!

Source: AFP

Authors:
AFP avatar

AFP AFP text, photo, graphic, audio or video material shall not be published, broadcast, rewritten for broadcast or publication or redistributed directly or indirectly in any medium. AFP news material may not be stored in whole or in part in a computer or otherwise except for personal and non-commercial use. AFP will not be held liable for any delays, inaccuracies, errors or omissions in any AFP news material or in transmission or delivery of all or any part thereof or for any damages whatsoever. As a newswire service, AFP does not obtain releases from subjects, individuals, groups or entities contained in its photographs, videos, graphics or quoted in its texts. Further, no clearance is obtained from the owners of any trademarks or copyrighted materials whose marks and materials are included in AFP material. Therefore you will be solely responsible for obtaining any and all necessary releases from whatever individuals and/or entities necessary for any uses of AFP material.