Eskom has released its outlook for the summer period, from 1 September 2024 to 31 March 2025, following a successful winter with 152 consecutive days without loadshedding. The Generation Operational Recovery Plan, initiated in March 2023, continues to enhance efficiencies and deliver significant improvements in Eskom’s fleet performance.
Key Highlights:
- Loadshedding-Free Winter: The 2024 winter period saw no loadshedding, a significant improvement compared to 153 days in winter 2023.
- Economic and Financial Boost: Eskom’s improved performance could contribute to an estimated 2% growth in the South African economy and better financial results for Eskom in FY 2025.
- Reduced Unplanned Outages: The Unplanned Capacity Loss Factor (UCLF) averaged 12,400MW during winter 2024, a 20% improvement and 3,100MW lower than anticipated.
- Increased Planned Maintenance: Eskom exceeded its maintenance target, achieving an average of 4,799MW during winter 2024, surpassing previous years.
- Improved Energy Availability: The Energy Availability Factor (EAF) rose from 57.00% in April 2024 to 67.02% by July 2024, reflecting a 10.02% improvement.
- Lower OCGT Usage and Cost Savings: Reduced reliance on Open-Cycle Gas Turbines (OCGTs) led to a 74% reduction in diesel costs, saving over R10 billion compared to the previous year.
Based on the improved generation performance, Eskom’s Summer Outlook has been revised, with the base case scenario projecting no loadshedding if unplanned outages stay at 13,000MW or below. Even in scenarios with higher unplanned outages (up to 15,000MW), loadshedding would likely be limited to Stage 2 at worst.
Additional Business Updates:
- Increased Generation Capacity: Eskom plans to add approximately 2,500MW by January 2025, with significant contributions from Koeberg Nuclear Power Station Unit 2, Kusile Unit 6, and Medupi Unit 4.
- Workforce Stability: Eskom’s staff turnover has decreased to 1.5%, and the employee morale index has risen from 3.6 to 3.9. The company is also building a strong talent pipeline with 2,000 learners, 80% of whom are in technical roles.
Overall, Eskom’s ongoing recovery efforts and operational improvements are positioning the company for a more stable and efficient performance in the coming months.
“As Eskom enters a competitive electricity market, it has not only delivered a winter free of loadshedding, but it has done so by being efficient and saving over R10 billion in diesel spend that will be a strong driver to a possible return to profit in our current financial year (FY25). This outcome has led to predictions suggesting ongoing performance can contribute to potential growth in the economy of around 2%,” said Dan Marokane, Eskom Group Chief Executive.
“Globally, market reforms as we are going through in South Africa generally led to lower electricity prices and Eskom will absolutely compete on that basis. The winter performance demonstrates what this company is capable of as we undertake our further strategic initiatives and re-affirms Eskom as worthy of further future investment to serve South Africa and drive economic growth. I would like to express gratitude to the Eskom employees for their hard work and dedication in moving Eskom towards operational sustainability,” concluded Marokane.
Delivering a competitive and sustainable future proof Eskom
“The visible, structural shift in the generation fleet performance demonstrates the quality of work Eskom’s teams, supported by our stakeholders, have delivered to strengthen the infrastructure of this country, and ensure that what is fixed stays fixed, cost effectively. We would like to thank all stakeholders, including the government and the National Energy Crisis Committee (NECOM), for their unwavering support. We will continue to build on the successes of the Generation Operational Recovery Plan and optimise resources and processes,” said Eskom Group Executive for Generation, Bheki Nxumalo.
“By returning more capacity to the grid we have not only suspended loadshedding, but we have also created a buffer so when we experience delays in returning further units to the fleet, the impacts that are experienced are much less severe and we will continue to focus on increasing the generation capacity of the fleet,” concluded Nxumalo.
Eskom remains focused on achieving financial and operational sustainability through continued improvements in the EAF, aiming for 70% by March 2025. The company is also focused on reducing municipal arrear debt, enhancing measures to address crime and corruption and developing a skilled workforce to secure its long-term success.
As part of its strategy to foster a competitive energy industry, significant progress is being made towards the legal separation of Eskom’s operations. Plans are in place to establish independent generation and distribution subsidiaries under Eskom Holdings SOC Limited within the same timeframe. This restructuring aims to enhance efficiency and strengthen the company’s future sustainability.
Eskom is further committed to diversifying its energy sources by launching 2 000MW of clean energy projects as part of its push for a sustainable energy future.
