EDITORIAL: Eskom reaps the whirlwind of shoddy choices
Let’s hope this week’s dimming of the lights doesn’t convince all three ratings agencies that SA now warrants junk status
Eskom has done it. Again. Just as the country looked like it was about to wriggle out of its self-inflicted growth constraints, the power utility tightened the straitjacket, as rolling blackouts swept through the country.
It came at an awful time. President Cyril Ramaphosa, his investment advisers and local CEOs have been scouring the globe impressing on skittish global investors that after a destructive decade, SA is again open for business. And he has scored some apparent morale-boosting successes, including pledges of about R300bn.
But the abrupt return of power rationing seriously undercuts his message. That Eskom slid back into load-shedding wasn’t a surprise; after all, experts had been warning of this for weeks. Rather, it was the scale and magnitude of the collapse — the grid lost 4,000MW of its 46,000MW on Monday — that shocked the country.
Even more disturbing, though, are revelations that the utility’s newest mega power stations contributed the most to the rolling blackouts.
The Medupi and Kusile power plants were built for R300bn and, at full capacity, are meant to provide 9,600MW of power. They were both meant to have been completed by 2014 but, five years later, only half of Medupi’s six generating units are running, while only two from Kusile are connected to the grid. And even those five units, with a combined capacity of 4,000MW, are performing at about 60% of capacity.
In response, Eskom has blamed poor performance by its contractors — including Alstom and Hitachi Power Systems — for widespread problems at Medupi and Kusile. For one thing, the generators are constantly tripping due to poor workmanship, and Eskom has also highlighted design flaws in the stations.
SA has suffered yet another day of consecutive power cuts caused by major problems at the main energy supplier Eskom. The government has only recently announced plans to split up the state-owned entity, but potential job cuts has made that unpopular with unions.
Hitachi, in which the ANC held a 25% stake through a front company called Chancellor House, has been a serial underperformer, which should shoulder most of the blame for the problems at both power stations. Back in 2013, Eskom was forced to import welders from Malaysia to fix 10,000 welding faults at Medupi, and there were similar problems at Kusile.
In Alstom’s case, it failed to get the control and instrumentation system for both Medupi and Kusile going, so German firm Siemens was hired to fix the mess. But Alstom was still not fired, as it seemed to enjoy political protection.
In all, it’s a long history of disastrous planning, zero accountability, and contractors picked for the wrong reasons. And the entire population is now carrying the can for this failure. In the dark.
This week, besides Medupi and Kusile, there were eight other generating units at five other power stations which broke down, either due to routine maintenance, or an uncontrolled outage. And to make this even more fragile, 10 power stations have been experiencing coal shortages for more than two years.
The point is, all of these problems are self-inflicted. Ineptitude, sabotage on some occasions, and corruption within Eskom and its political overlords are all ingredients that have created a fragile grid in recent years.
The government, particularly former president Jacob Zuma and his erstwhile public enterprises ministers Malusi Gigaba and Lynne Brown, must accept most of the blame. Their chronic desire to appoint unqualified or corrupt directors and executives, who could rubber-stamp multibillion-rand tenders, means the utility is all but denuded of skills today. Eskom, after all, has had 10 CEOs since 2007, as well as eight chairs and six finance directors.
Let’s hope this week’s dimming of the lights doesn’t convince all three ratings agencies that SA now warrants junk status.