The latest in a string of resignations in 2018 is Thava Govender, group head of generation, who will leave Eskom at the end of October. Picture: REUTERS
The latest in a string of resignations in 2018 is Thava Govender, group head of generation, who will leave Eskom at the end of October. Picture: REUTERS

Veteran executives continue to leave Eskom like rats from a sinking ship as the embattled power utility’s already dire financial situation looks set to worsen.

The latest in a string of resignations in 2018 is Thava Govender, group head of generation, who will leave Eskom at the end of October.

Govender, who is also acting group executive for risk and sustainability, has worked for Eskom for 27 years.

News of his departure comes one week after Johnny Dladla, CEO of Eskom Rotek Industries, a subsidiary of the organisation, also tendered his resignation. Dladla, who served as interim group CEO between June and October 2017, has been with the organisation for 23 years.

A number of resignations earlier in 2018 appeared  to be part of  clean-up efforts by the new Eskom board, installed in January. They include those implicated in the public protector’s “State of Capture” report such as head of generation and former acting CEO Matshela Koko and CFO Anoj Singh. After Koko’s departure in February, Govender, who was not implicated in the state capture report, was moved from head of transmission to head of generation.

Operationally, Eskom continues to face challenges. Coal supply shortages plague at least 10 of Eskom’s 15 base load power stations and it has warned of the risk of load shedding. Last week, a live steam pressure from a boiler at Lethabo power station ruptured and resulted in the death of an Eskom employee and the injury of another. The unit in question will remain out of service for three months, and this is expected to affect the national power grid, the utility said.

Meanwhile, in a note circulated to Eskom staff group COO Jan Oberholzer said the utility faces serious challenges in reaching its financial targets and could not carry on as if it were business as usual. Already the annual interest bill on its debt is R45bn, he noted.

Anton Eberhard, a professor at the University of Cape Town’s Graduate School of Business, said this was somewhat higher than what Eskom forecast in its tariff application to the National Energy Regulator of SA, which it submitted a few months back. Over the next three years Eskom’s interest and principal payments on debt will exceed R263bn while its revenue is R200bn per annum, Eberhard said.

“Eskom is just not generating enough cash to cover the cost of operations … and the cost of capital,” said Eberhard.  “Something has to give”.

Steynl@businesslive.co.za