The man who keeps load-shedding away
Eskom’s performance under new chief executive Dan Marokane has improved dramatically, with fewer breakdowns and a much higher energy availability factor.
Marokane assumed office as the group chief executive on 1 March 2024, replacing acting CEO Calib Cassim.
He is a qualified chemical and petroleum engineer who has previously served as a group executive at the power utility.
He served as chairman of Eskom Enterprises, director of Eskom Rotek Industries, and chief commercial officer of Eskom Holdings.
Before rejoining Eskom, he served as the chief executive officer at Tongaat-Hulett, where he helped build a strategy to save the company.
He has led operations across the oil, gas, energy and manufacturing sectors, overseeing procurement budgets of over R100 billion and capex budgets of R60 billion annually.
He holds a BSc in Chemical Engineering from the University of Cape Town (UCT), an MSc in Petroleum Engineering from the University of London, and an MBA from UCT.
When he was appointed, the Eskom board asked Marokane to prioritise assessing the Generation Operational Recovery Plan in his first 100 days in office.
Eskom initiated the plan in March 2023, focussing on accelerating and executing planned maintenance.
Eskom chairman Mteto Nyati explained that it differed from the planned maintenance under Andre de Ruyter as it used original equipment manufacturers (OEMs).
“When we take a plant down, we work with people with deep expertise about the equipment used at that plant,” he said.
Previously, maintenance was done by people with limited or no understanding of the equipment at the plants.
“These first 100 days are crucial for helping Marokane gain the necessary insights about Eskom and the industry,” Eskom said on 1 March 2024.
Last week, Marokane shared his progress in addressing Eskom’s business challenges in his first 100 days in office.
Apart from looking at the recovery plan, he reviewed Eskom’s unbundling implementation and put the building blocks in place to create a sustainable company.
“The generation performance has shown a step change, with almost 80 days of no load-shedding and unplanned outages consistently around 12 GW,” he said.
Unplanned outages, which hit a low point of 9.5GW, are below the winter planning assumption of 15.5GW, which would trigger up to Stage 2 load-shedding on some days.
This performance comes from a sustained program consisting of adequate human resources and aggressive planned maintenance.
He added that using Original Equipment Manufacturers (OEMs) for critical systems was paying dividends.
This improved performance has had a positive impact on Eskom’s financials, given the significant year-on-year reduction in diesel usage.
The power utility saved over R4 billion in the current financial year because it did not have to use Open-Cycle Gas Turbines (OCGTs) as much as anticipated.
“Eskom’s executives and employees have helped deliver these significant results to date, and we have a good base on which to build,” Marokane said.
“We are putting the building blocks in place to rebuild trust and credibility in Eskom through transparent performance.”
Eskom’s improved performance
The load-shedding reprieve is due to Eskom’s improved performance and lower demand due to solar PV installations.
Eskom’s unplanned capacity loss factor (UCLF) decreased from 35.5% to 27.69% in the financial year to date.
This reduction in UCLF represents a 7.81% improvement in the current financial year as compared to the previous year in the same period.
The lower breakdowns resulted in Eskom’s energy availability factor increasing from 53.7% to 61.29% year-to-date.
The weekly EAF has moved from 57% at the beginning of the financial year to 65% from 1 April to 13 June 2024.
“The EAF improvement is primarily due to a drop in the unplanned outages of the generation units, which averaged at 11,700MW during the past seven days,” Eskom said.
Energy analyst Chris Yelland said that over the last week, unplanned outages decreased, planned maintenance increased, and the EAF was ten percentage points higher.
“This is a remarkable achievement by Eskom,” Yelland said as part of an analysis of the power utility’s performance.
Marokane said Eskom will pursue its strategy across several key initiatives over the next three years.
The power utility is planning to increase its energy availability factor (EAF) to 70% in the next 12 to 36 months.
It will return more than 2.5GW in capacity to the grid by March 2025 and develop an executable initial pipeline of at least 2GW of clean energy projects by 2026.
“Eskom will continue to focus on implementing generation recovery, strengthening governance and tackling crime and corruption,” Marokane said.
“We will also future-proof the organisation to enable energy security, growth, and long-term sustainability for South Africa.”
The charts below, courtesy of Chris Yelland and EE Intelligence, show Eskom’s improvement over the last few months.
Energy availability factor (EAF) – 2024 in green
Eskom breakdowns (UCLF) – 2024 in orange
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