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As the government considers proposals to restructure Eskom and its balance sheet, it is important to remember why the company has failed. Some of the proposed solutions — such as splitting Eskom into generation, transmission and distribution companies — are not related to any of the causes of the utility’s crisis.

Eskom did not fail because it is too big, so splitting Eskom into three companies will not deal with any of its immediate problems. It will just add complexity to the electricity sector and introduce a new set of problems, which will get in the way of stabilising the utility’s finances and operations...

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