DEON JAMES: Eskom leadership must make the necessary decisions for real change

SA, like many developing countries, is recovering from the catastrophic effects of a prolonged pandemic on the economy. A major complication in our case is the performance of Eskom, which is vital to restart an already flailing economy.

Sadly, Eskom’s performance has deteriorated further since I last wrote in Business Day on the subject in February 2019.

Many good articles have been written recently about why this has been happening, but an announcement of review teams gives no comfort that the situation will improve in the short or long term.

A recap of where we are:

• Eskom’s generation performance has deteriorated, especially lately due to industrial action. Yet Eskom is an essential service and any industrial action has major consequences. Salary increase demands are questionable at this time. Both performance and cost are variables that have so far seemingly been ignored for selfish reasons. The illegality of the recent strikes is clear, but surely the moral and economic responsibilities are also key aspects.
• Projects have been approved and developed under the relaxation of generator licence requirements from 1MW to 100MW. However, this is far too slow and insufficient to mitigate current supply shortages.
• There have been no significant policy changes that have had real positive effects on the quality and price of electricity delivered to the customer. More rapid opening up of this industry has to be actioned — there are models that have been effective around the world, and dire action is needed.
• Bad debt of customers, corruption and theft continue to plague Eskom (no changes here over decades, and the level has become seemingly unsurmountable). Unless the utility and country improves its supply side as a priority, more people will take desperate measures. Eskom should take care of the low-hanging fruit, those that should be clearly in the utility’s technical capabilities.
• The skills are still around in SA, though morale and culture are questionable. There is no need to bring in “experts” from outside the country.
• Eskom has become a punching bag for political, economic, and personal aspirations.

To summarise, the current policymakers and Eskom leadership have to make the decisions they know are necessary for real change to take place. This will not magically happen under the current structure and thinking. The only solution will be a collaborative effort by all parties (they know who they are) to fix things. The crisis is further straining this beautiful country and people, and the fragile social compacts of the new SA are at risk of snapping. Just look around you.

• James, a mechanical engineer and former Eskom regional distribution manager, joined Dagupan Electric Corporation in 2003 to help the Philippines electricity industry deal with similar issues to those SA is now experiencing – reliability of generation supply and utility debt.