ESKOM and the problems of South African energy

Abstract

For a long period, the industrial development of South Africa has been stimulated by cheap and abundant electricity supply through a unified energy system created in 1969–1973 by ESKOM (until 1987 ESCOM), founded in 1923 as an Electricity Supply Commission, a state-owned enterprise. Until early 2000, Eskom was considered one of the most advanced and efficient energy utilities of the world. During the last two decades it is in deep crisis and actually turned bankrupt, being drained by corruption, mismanagement and technological decay. Eskom has been confronted with escalating plant breakdowns and critically tight reserve margins, to the extent that reliable electricity supply of the economy has been blocked. The troubled utility failed to meet demand, resulting in South Africa’s numerous crippling blackouts between 2007 and 2023. Eskom has also been unsuccessfully struggling to service its massive debt – over $30 billion, largely due to massive theft and corruption. BBEE policies and «positive discrimination» aggravated problems of the company by spreading «tenderocracy», lowering professional standards and quality of fuel, now supplied in small portions by small Black-owned companies from great distances. Ambitious plans of nuclear energy development (SA has the only nuclear power station on the continent) were scrapped, new big coal-fired power plants Medupi and Kusile were built with great delays and are already breaking down. Instead of efficient utilization of existing great fossil fuel resources, a very dubious «just transition» plan with decarbonization, accompanied by division and privatization of ESKOM, is now accepted, being dragged by Western powers – supported by ecological lobby. Poverty and inequality inherited from apartheid only grow as a result of neoliberal economic policies of post-apartheid period.