A major contract dispute at the Kusile Power Station has been resolved, saving the utility over R1 billion. The settlement avoids protracted legal battles and safeguards public money.
In a significant financial victory for the state-owned power utility, Eskom has confirmed the full and final settlement of a long-standing commercial dispute with the Stefanutti Stocks Basil Read Joint Venture (SSBR) concerning the Kusile Power Station. The resolution slashes the original claim of R1.6 billion down to a R580 million settlement, saving just over R1 billion.
The dispute, which began in 2022, was resolved following a formal Dispute Adjudication Board (DAB) process. Through constructive engagement, Eskom not only adhered to the DAB’s decision but ultimately settled for R105 million less than the recommended amount of R685 million. This final figure of R580 million resolves claim 5, claim 6, and Eskom’s own counterclaim.
Eskom’s Group Chief Executive, Dan Marokane, highlighted the outcome as evidence of the utility’s strengthened internal controls.
“As Eskom drives multiple initiatives to increase efficiencies across the utility, the results demonstrate the extremely robust measures that have been put in place to defend Eskom and its balance sheet against contractor claims,” said Dan Marokane.
The utility emphasized that this settlement reflects its strategic approach to balancing cost and risk by avoiding prolonged and expensive legal proceedings. Crucially, the payment to SSBR will not be recovered through electricity tariffs, directly protecting consumers. Eskom also noted that such settlements are standard practice on large, global infrastructure projects and do not constitute an admission of fault or liability.
With Kusile Power Station now fully operational, this settlement brings closure to a key legacy issue. It allows Eskom to focus its efforts on contract close-out, optimising the plant’s performance, and its core mission of delivering reliable energy to South Africa. The utility reaffirmed its commitment to strong governance and the disciplined management of public funds.
