Eskom falling short

Eskom has consistently failed to meet the performance targets set by the government in 2022, as the utility has not managed to achieve its key objective of returning its energy availability factor (EAF) to above 70%. 

Minister of Public Enterprises at the time, Pravin Gordhan, unveiled these EAF targets as part of Eskom’s turnaround plan to bring load-shedding to an end. 

These targets were staggered over the coming years, with the utility aiming to improve its EAF to 65% by March 2024 and 70% by March 2025. 

Eskom has failed to meet any of these targets, with its EAF for the year from 1 April to 31 March 2025 being 60.6%. 

The EAF shows the percentage of time the power station was available for use when it was needed, and it’s a key measure of a power utility’s performance.

If Eskom’s EAF can be improved to around 70%, load-shedding will be a thing of the past, and South Africa will have electricity security.

However, its performance since the announcement has been underwhelming, continuing its decline from the late 2000s when load-shedding was first implemented. 

For a large part of its history, Eskom has delivered cheap and reliable electricity, producing over half of all of Africa’s electricity and being named Power Company of the Year in 2001. 

In the late 1990s, the government implemented a policy to increase electricity access in rural areas and previously underserved urban townships. 

This created a rapid rise in electricity demand, which put pressure on Eskom’s existing infrastructure. In 1998, a White Paper warned that the utility’s capacity would be fully utilised by 2007. 

The government under Mbeki, intent on running a tight fiscal ship, did not want to spend billions building new power stations and refused to enhance Eskom’s capacity. 

As predicted, Eskom faced a severe shortfall in 2007, leading to South Africa’s first nationwide power outages and the introduction of load-shedding in 2008.

“The decision not to invest in new generation capacity in the early 2000s was the main cause of the trouble we ran into beginning in 2006,” Eskom chairman Mteto Nyati told the Centre for Development and Enterprise. 

“Then, this miscalculation was compounded by the hasty decision to construct Medupi and Kusile. Building large-scale infrastructure like that requires skilled professionals and planning, and it takes time.”

Eskom did not have the capacity or technical expertise to build these two huge coal-fired power stations, as engineers and skilled professionals left the utility to join the private sector or retire. 

“All of this led to incorrect technical specifications, and then, of course, there were massive delays and cost overruns as corrupt individuals and unqualified companies siphoned off money.”

Eskom’s collapse came to a head in 2023 when South Africa experienced the worst load-shedding on record. The country experienced outages for 335 days of the year, and stage 6 load-shedding was a regular occurrence.

This decline in performance can be seen in the graph below, courtesy of Stanlib chief economist Kevin Lings, which shows Eskom’s declining EAF over the past decade. 

The turnaround plan

In 2024, Eskom’s performance significantly improved to halt the decline in the EAF of its fleet as its investments in maintaining its coal-fired power plants bore fruit. 

South Africa experienced no load-shedding for nearly an entire year, marking a dramatic turnaround from 2023, when the utility regularly plunged the country into rolling power cuts. 

In particular, its coal-fired power stations have produced a much-improved performance. In the past, Eskom’s power stations would trip or break down soon after undergoing maintenance due to the poor quality of repairs.

Eskom also reached a significant milestone on 23 July 2024 by achieving 35,000 MW of available capacity, with an evening peak demand of 30,740 MW.

This level of available capacity has not been seen for six years, last achieved on 16 July 2018, before the utility had to implement elevated levels of load-shedding regularly. 

Much of the credit has been directed to Eskom’s Group Executive for Generation, Bheki Nxumalo, who built four pillars on which the utility’s turnaround could be built. 

The first pillar is the people of Eskom, with Nxumalo being focused on engaging with employees on the ground regarding what has gone wrong with the utility’s power stations in recent years. 

Eskom employees were also encouraged to celebrate wins, no matter how small, to improve morale and ensure that following standard procedures was rewarded. 

The second pillar is termed ‘strategy’, which is closely tied to the first as part of it involves making power station managers directly responsible for the performance of their plants. 

As part of this, Nxumalo led a significant overhaul of Eskom’s power station managers, with over 40% of all managers being changed as they were in the wrong roles. 

Accountability as the third pillar is again closely tied to the first two. Nxumalo and his team imposed clear measurements for key individuals and implemented periodic reviews of the staff’s performance. 

Crucially, the staff’s performance was aligned to short-term incentives to ensure a quick turnaround in the quality of maintenance and overall performance. 

Finally, it was vital that Eskom communicated its actions to both its employees and the public to assure them that it had a recovery plan and that its improved performance was sustainable. 

However, in recent months, this turnaround has sometimes come unstuck, with the utility having to implement load-shedding once again. 

Financial services firm PwC said South African business leaders identified energy supply shortages as their primary risk factor for the economy during 2025/26. 

“In other words, half a year after load-shedding was suspended, business leaders were not convinced that planned power cuts were a thing of the past,” the firm said. 

“And justifiably so: for most of the load-shedding-free period, Eskom’s unplanned outages were, on average, nearly 12,000 MW.”

PwC explained that this indicates a lingering and large burden of unexpected breakdowns, about a quarter of the utility’s installed capacity.

Eskom’s failure to meet its performance targets shows that its system remains vulnerable. Load-shedding could return at short notice, with Nyati and Eskom unwilling to confidently say that South Africa has seen the end of power cuts.