Big change at Eskom

South Africa’s state power utility expects to avoid electricity shortages over at least the next few months, extending a streak that’s coincided with an operational turnaround.

Eskom’s failure to maintain its aging fleet of plants while dealing with mismanagement and corruption led to record outages — known locally as loadshedding — that intensified through last year, crimping the economy.

Ongoing repairs and initiatives by the company enabled it to halt the nationwide power cuts in March.

“We’re now at the point where we can comfortably tell that there’s been a structural shift in the performance of a coal fleet,” Eskom Chief Executive Officer Dan Marokane said in a presentation Monday, noting that staff morale has also improved.

Another 2,500 megawatts of capacity is expected to come online by March next year and will guarantee that blackouts won’t resume, bar any exceptional circumstances, he said.

Since the company gave its last operational update in April, about 12.4 gigawatts of Eskom’s generating capacity has been unavailable due to breakdowns.

According to the CEO, if that figure remains less than 13 gigawatts, Eskom can avoid power cuts through the upcoming summer months.

The company has scaled back on using its expensive auxiliary diesel-fired units, spending 10 billion rand ($565 million) less on the fuel compared with a year earlier.

“It looks like we’re getting to the end of load-shedding,” Eskom Chairman Mteto Nyati said at the briefing in Johannesburg.

The company’s finances are in better shape due to a 254 billion-rand bailout that the government awarded it in 2023 and is being dispensed in tranches.

Still, a mounting arrears owed to Eskom by municipalities is problematic, Nyati said. Overdue debt stood at 82.3 billion rand at the end of June, according to the company.

Going forward, Eskom’s 390 billion-rand transmission-development program will be among its top priorities. Sections of the grid have already been saturated by green-energy projects and a major expansion of connections is required.

The state utility plans to build 14,218 kilometers (8,835 miles) of power lines over the next decade, more than three times what it has installed over the past 10 years. It will also have to increase its transformer capacity sixfold and build other infrastructure.

Eskom plans to install more than 800 kilometers of lines within the next three years as it develops its own pipeline of 2,000 megawatts of clean-energy projects, according to Marokane.

“We will get to a point where the transmission business itself is geared up to producing or constructing lines at the rate that is responding to the demand that is out there,” he said. “This business has done it before, not so many years ago.”