Matshela Koko takes reins at Eskom as acting CE
Eskom head of generation Matshela Koko was on Wednesday named acting CE of the power utility by Public Enterprises Minister Lynne Brown.
The move is not likely to restore market confidence in Eskom, which last week had its credit rating cut by S&P Global Ratings to BB, two notches below investment grade.
Koko has a controversial history with the company and has been outspoken in favour of nuclear power and against renewable energy. Koko, who has been with Eskom since 1996, was recommended for the position by the Eskom board after the surprise resignation of Brian Molefe in November. Molefe was tainted by reports that he had favoured the politically connected Gupta family and assisted it to buy the Optimum coal mine.
Koko said on Wednesday that he believed Molefe was the best person for the job and that he remained disappointed over his resignation. "This is not where we should be. I feel Brian should still be here, doing the job that he had set himself to do," he said.
His top priority would be to make sure that the company minimised its reliance on government guarantees and that it brought down electricity prices, he said.
In recent months, Koko has been on an aggressive public campaign writing several opinion pieces in newspapers, arguing for the necessity of new nuclear plants and claiming that renewable independent power producers were costing Eskom and "crowding out" its tariff.
Despite the publication of a draft Integrated Resource Plan (IRP) last week, which suggested that nuclear power would not be required for another 25 years at least, Koko has remained resolute that Eskom should proceed in 2016 with a call for proposals to vendors.
Integrated Resource Plan
Despite the publication of a draft Integrated Resource Plan last week, which suggested that nuclear power would not be required for another 25 years at least, Koko has remained resolute that Eskom should proceed in 2016 with a call for proposals to vendors
Energy Minister Tina Joemat-Pettersson agreed with his stance, he said on Wednesday. Regardless of the nuclear commissioning date, the call to vendors would provide an indication of costs of nuclear power. He argued that under a different scenario than that advanced by the base case of the IRP, a reactor would be required by 2026.
While Molefe has been tainted by procurement irregularities related to the Guptas, Koko has also been involved in his fair share of controversy over tenders.
Among others, he was at the centre of the award of a nuclear contract for a new steam generator for Koeberg to French company Areva two years ago. Losing bidder Westinghouse, which has taken the dispute all the way to the Constitutional Court, claims that new criteria were introduced into the tender documents at the 11th hour, enabling Areva to snatch it from Westinghouse, although it had made a better offer.
Koko was also close to the controversy over a multibillion-rand information technology (IT) support contract in 2013. The award of the contract was in the end canned and German multinational T-Systems, which held the original contract, had its tenure extended. But this was only after almost 18 months of wrangling in which a key IT manager running the procurement was suspended without due cause by then CE Collin Matjila. The manager later left with a separation agreement.
Brown said she had faith in Koko to continue Eskom’s current trajectory and had asked the board to immediately start the process to appoint a permanent group CE.