SA marks 100 days without load shedding, but ‘risk still exists’

Eskom is celebrating 100 consecutive days without load shedding. The power utility announced the suspension of the power cuts on 27 March.

Group executive for generation Bheki Nxumalo said this was a result of its Generation Operational Recovery Plan, initiated in March 2023, and planned maintenance.

These were made possible by financial support from the National Treasury Eskom debt relief scheme.

In his budget speech earlier last year, Finance Minister Enoch Godongwana announced debt relief of R254 billion over three years.

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This included liquidity support of R78 billion in 2024, R66 billion in 2025, and R40 billion in 2026, along with the takeover of R70 billion in Eskom debt in 2026 to support Eskom’s debt and interest payments as they fall due.

Eskom received debt relief of R16 billion in August 2023, R12 billion on 26 October and R8 billion on 30 October.

Load shedding risk

The last time South Africans enjoyed a prolonged period without load shedding was from 8 September to 11 December 2020.

“The achievement of 100 continuous days without load shedding is the outcome of diligent execution of recovery plans and the tireless efforts of our 40 000 dedicated and skilled Eskom employees,” said Nxumalo.

“If we maintain a 70% Energy Availability Factor (EAF) and add significant capacity within the country, we can ensure adequate available capacity to meet demand without a significant risk of load shedding.”

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However, group chief executive Dan Marokane was cautiously optimistic.

“Considering the intensity and the levels of load shedding in 2023, the ability to get to 100 days without load shedding is significant, while acknowledging that the risk of load shedding still exists,” he said.

Eskom’s winter forecast anticipates a likely scenario of load shedding limited to stage 2.

Eskom had also achieved a R6.2 billion reduction in diesel expenditure from 1 April 2024 to 30 June 2024.

“If we maintain our trajectory on reduced diesel spend, it will be a strong driver in a possible return to profit in FY25.”

Eskom finances

Eskom posted a R23.9-billion loss for the year ending March 2023. This was the largest loss the power utility had ever experienced.

Primary energy costs grew by 16.6%, with the growth in Open Cycle Gas Turbines (OCGTs) expenditure being the biggest contributor. This was due to a rise in production from Eskom-owned and IPP OCGTs, along with increased diesel prices.

In its financial report, the power utility said it was working on a turnaround plan to address its debt burden.

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One of these plans involved the court challenge against Nersa’s tariffs, which Eskom claimed were not cost-reflective.

“The lack of cost-reflective tariffs and resultant revenue shortfall over the past two decades has been a key contributor to Eskom’s poor financial performance and reliance on debt,” it said.

While no adjustment was granted for 2023, Eskom successfully challenged Nersa’s tariffs in court, resulting in announced tariff increases of 18.65% and 12.74% for 2024 and 2025, respectively.

“We will persist in implementing the operational recovery plan, strengthening governance, and future-proofing the organisation to ensure energy security, growth, and long-term sustainability for the benefit of South Africa and sub-Saharan Africa,” it said.

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“We remain committed to improving the current business while laying the groundwork for future opportunities and initiatives.”