THE BIG READ
Eskom’s existential crisis
As it stands, the power utility now survives only to pay off its debt
In its almost 100-year existence, Eskom has perhaps never faced such an existential crisis as now. In the short term, the operational woes that have emerged recently, resulting in the return of load-shedding, will be eased when maintenance is completed. But load-shedding is likely to persist unless the issue of the company's balance sheet is addressed by its shareholder, the government. Eskom, which provides more than 90% of SA's energy, survives only to pay off its debt, which has rocketed from R40bn to more than R400bn in just over a decade. If costs continue to rise and its bottom line doesn't improve through higher demand and tariffs, Eskom's debt could climb to R600bn over the next three years. While state capture has been a central narrative around Eskom during former president Jacob Zuma's tenure, fuelling a crisis in confidence in the institution and by extension SA, the root cause of the company's woes can be traced to the administration of former President Thabo Mbeki. A f...
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