South Africa’s energy crisis remains one of the most pressing challenges facing the nation. Eskom, the state-owned power utility, has long been at the centre of the struggle to provide a stable and reliable electricity supply. While recent milestones have signalled progress, setbacks continue to expose deep-rooted challenges, negatively impacting households and businesses. The road ahead demands urgent reforms, strategic investment, and decisive leadership to secure the country’s energy future.
Milestones: Glimpses of Stability
Despite years of uncertainty, Eskom marked a significant achievement on 21 January 2025, reaching 300 consecutive days without loadshedding – the first such milestone since June 2018. This success was largely attributed to the Generation Recovery Plan, introduced in March 2023, which aimed to improve the performance and reliability of Eskom’s generation fleet.
The Group Chief Executive (GCE), Dan Marokane, has emphasised that his team has been focusing on improving plant reliability, enhancing governance, and increasing generation capacity. He, alongside the Minister of Electricity, Kgosientsho Ramokgopa, have assured the country of their commitment to eliminating loadshedding and positioning Eskom for long-term sustainability.
Missteps: Recurring Setbacks and Systemic Failures
While notable progress has been made, Eskom continues to face operational and financial instability. Between late January and late February 2025, South Africa experienced a sharp return to loadshedding, disrupting businesses and daily life. The optimism following the 300-day streak without power cuts quickly faded as Eskom reintroduced Stage 3 loadshedding on 31 January due to unforeseen structural challenges within the generation fleet.
The situation deteriorated further on 23 February when multiple unit failures at Majuba, Camden, and Medupi power stations forced Eskom to escalate loadshedding to Stage 6 – just three weeks after Stage 3 had been declared. The recurrence of these disruptions highlights the fragility of Eskom’s power generation system and the persistent risk of breakdowns.
Despite suspending loadshedding on 26 February following the recovery of critical generation capacity, the instability remained. By 7 March, Eskom was once again forced to implement Stage 3 loadshedding due to the sudden loss of 2,700MW in a span of just 14 hours, stemming from failures at Koeberg and Kusile power stations.
Eskom’s long-standing struggle with poor maintenance, slow repairs, and aging infrastructure continues to hinder its ability to provide consistent electricity. A lack of funding for maintenance has led to postponed repairs, declining efficiency, and frequent breakdowns, making loadshedding an unavoidable reality.
The Path Forward: Urgent Reforms and Strategic Investment
Eskom’s financial crisis has placed immense pressure on the utility to explore funding solutions. In September 2024, it proposed an unprecedented 36.15% tariff increase for the 2025/26 financial year, along with further hikes of 11.81% for 2026/27 and 9.1% for 2027/28. However, the National Energy Regulator of South Africa (NERSA) rejected this application as excessive, instead approving significantly lower increases of 12.74%, 5.36%, and 6.19% for the respective years.
On the other hand, municipalities’ debt owed Eskom reached R109.4 billion in January 2025. The graph below shows that municipal payment levels have decreased, further adding to the utility’s woes, amid Minister Ramokgopa raising the possibility that Eskom would never be able to recover the billions of rands in unpaid electricity bills from the errant municipalities.
Given South Africa’s struggling economy, soaring unemployment, and rising cost of living, drastic tariff hikes in the absence of further government bailouts are unsustainable. Instead of relying solely on price increases, Eskom must pursue a multifaceted approach to address its financial and operational issues.
Key steps for Eskom’s turnaround include:
- Debt Restructuring: Addressing its massive debt burden to improve financial sustainability. The positive news is that Eskom forecasts that it will post a full-year profit of R10 billion for 2024/25.
- Tackling Non-Payment: Enforcing stricter measures against non-paying municipalities and curbing electricity theft. In this case, national government will have to play a major role. National Treasury recently reported that most municipalities that signed up for the debt relief programme have not met their electricity payment commitments. Out of 71 local councils that signed up for the programme, only 23 had met their payment obligations by March 2024.
- Strengthening Governance: Implementing stronger financial controls and accountability mechanisms to prevent mismanagement.
- Tackling Corruption: Eskom will have to ramp up efforts to deal with corruption within the utility. It has to be noted that Eskom’s strengthened collaboration with the NATJOINTS Energy Safety and Security Priority Committee has yielded positive results thus far.
- Investing in Infrastructure: Prioritising maintenance and modernisation of power stations to prevent unexpected breakdowns.
- Renewable Energy Integration: Expanding participation in the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) to diversify energy sources and reduce reliance on aging coal-fired plants.
A Defining Moment for South Africa’s Energy Future
Eskom stands at a critical juncture. While recent milestones offer hope, the persistent setbacks serve as a stark reminder of the urgent need for systemic reforms. South Africa’s economic growth, industrial competitiveness, and overall stability depend on a reliable energy supply.
The road ahead will require bold leadership, strategic investments, and unwavering commitment to structural change. Eskom must embrace modernisation, improve operational efficiency, and work towards a sustainable energy future. The pending Eskom’s legal separation into three distinct entities – Generation, Distribution, and Transmission – cannot be done fast enough.
Without decisive action, the cycle of progress and setbacks will continue, leaving South Africans to bear the brunt of an unresolved energy crisis. The choices made now will determine whether South Africa can break free from the shackles of energy insecurity or remain trapped in a cycle of crisis and missed opportunities.