{"id":1571,"date":"2020-09-03T16:14:58","date_gmt":"2020-09-03T14:14:58","guid":{"rendered":"https:\/\/mybroadband.co.za\/news\/?p=366054"},"modified":"2020-09-03T16:14:58","modified_gmt":"2020-09-03T14:14:58","slug":"eskom-in-crisis","status":"publish","type":"post","link":"https:\/\/interwebdev.co.za\/index.php\/2020\/09\/03\/eskom-in-crisis\/","title":{"rendered":"Eskom in crisis"},"content":{"rendered":"

Eskom\u2019s latest facts and figures show a company in crisis which is unable to meet its obligation to provide South Africa with reliable electricity.<\/p>\n

Eskom implemented stage 4 load shedding this week due to \u201cexceptionally high demand and continuing severe generation supply constraints caused by multiple unit breakdowns\u201d.<\/p>\n

It said load-shedding will persist throughout the weekend as its teams are working to return as many of these generation units to service as possible.<\/p>\n

Further bad news is that South Africans should not expect a resolution to load-shedding anytime soon.<\/p>\n

Eskom told Parliament that it expects power constraints to persist for at least the next year, adding that load shedding may extend into 2022 depending on the pressure on the system.<\/p>\n

Research by the Council for Scientific and Industrial Research (CSIR) has an even worse outlook<\/strong><\/a>, warning that South Africa should brace itself for exponential increases to load-shedding until 2022.<\/p>\n

\u201cNot only will load-shedding continue over the next few years \u2013 it will get significantly worse,\u201d said Dr Jarrad Wright and Joanne Calitz of the CSIR.<\/p>\n

It is not only Eskom\u2019s generation capacity which is in shambles. Its finances are in an even worse state.<\/p>\n

Eskom\u2019s debt ballooned to R488 billion at the end of March 2020, up from R440 billion a year earlier.<\/p>\n

The increasing debt is partly a result of the company\u2019s continued losses, which exceeded R20 billion in the last financial year.<\/p>\n

According to energy policy and investment specialist, Anton Eberhard, Eskom is technically insolvent.<\/p>\n

\u201cWithout state bailouts \u2013 which have totalled R188 billion since 2008 \u2013 Eskom would not have been able to service its debt,\u201d he said.<\/p>\n

Eberhard said the power utility\u2019s principal and interest payments in 2019\/20 were R70 billion and are expected to rise to R95 billion in 2020\/21.<\/p>\n

Principal and interest payments are now around half of Eskom\u2019s revenue, which he said is unsustainable.<\/p>\n

Inconsistent information<\/h3>\n

What frustrates many South Africans is the perceived lack of action and dubious information which comes from Eskom.<\/p>\n

In May this year, for example, Eskom said it only foresees the possibility of three days of Stage 1 load-shedding this winter, which should occur late in July.<\/p>\n

Industry experts like Ted Blom laughed off this prediction, saying South Africans should prepare for some of the worst load-shedding we have ever seen.<\/p>\n

Blom said Eskom executives have drastically misconstrued the scope of the problem and that it would take much longer than what they think to resolve Eskom\u2019s reliability issues.<\/p>\n

Fast-forward three months and Eskom\u2019s critics were proven right. 2020 is now the worst year ever in South Africa for power cuts.<\/p>\n

What is of concern is that the load-shedding comes amidst a partial lockdown and economic slowdown.<\/p>\n

\u201cTruth is, COVID-19, by shutting down half the country, saved us from several stage 6 load-shedding over winter,\u201d said business columnist Gareth van Onselen.<\/p>\n

This raises the question of what objective facts and figures tell us about Eskom and its ability to provide reliable electricity to South Africa.<\/p>\n

The charts below show that Eskom is in crisis, with increasing prices, decreasing reliability, and ballooning debt.<\/p>\n

\n

Energy Availability Factor<\/h3>\n

The energy availability factor shows the percentage of Eskom\u2019s generation capacity which is available, taking into account planned maintenance and unplanned breakdowns.<\/p>\n

Eskom\u2019s energy availability factor for 2019 and 2020 is significantly lower than what it was in the past three years, which is cause for serious concern.<\/p>\n

<\/a><\/p>\n

\n

Eskom\u2019s average electricity price \u2013 1994 to 2020<\/h3>\n

Between 2007 and 2020, Eskom\u2019s average electricity price<\/strong><\/a> increased by around 460%, not accounting for inflation.<\/p>\n

The rapid increase in electricity prices came as the country was hit by load-shedding and rampant corruption at Eskom.<\/p>\n

<\/a><\/p>\n

\n

Number of Eskom employees<\/h3>\n

The number of Eskom employees increased from 31,972 in 2003 to 46,665 in the latest reported financial year.<\/p>\n

Even more concerning is that the company\u2019s wage bill increased from R11.7 billion to R32 billion over this period.<\/p>\n

Eskom\u2019s power generation showed a slight decline during this time. This means the company\u2019s rapidly increasing workforce and wage bill had no relation to increased capacity.<\/p>\n

<\/a><\/p>\n

\n

Eskom debt<\/h3>\n

Eskom\u2019s debt securities and borrowings increased from R30 billion in 2005\/2006 to R488 billion in March 2020.<\/p>\n

This debt is completely unsustainable and poses a serious risk for both Eskom and the South African economy.<\/p>\n

<\/a><\/p>\n

\n

Eskom profit and loss<\/h3>\n

Eskom recorded its biggest loss in history last year and is expected to record another loss of around R20 billion<\/strong><\/a> this year.<\/p>\n

<\/a><\/p>\n

\n

Municipal debt<\/h3>\n

Eskom\u2019s municipal debt ballooned from R5 billion in 2012\/2013 to R26 billion in 2019\/2020.<\/p>\n

This adds to the power producer\u2019s financial woes and does not bode well for its ability to collect money owed to it.<\/p>\n

<\/a><\/p>\n

\n

Now read: Eskom electricity prices \u2013 1994 to 2020<\/a><\/h3>\n

Source: MyBroadband<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Eskom\u2019s latest facts and figures show a company in crisis which is unable to meet its obligation to provide South Africa with reliable electricity. Eskom implemented stage 4 load shedding this week due to \u201cexceptionally high demand and continuing severe generation supply constraints caused by multiple unit breakdowns\u201d. It said load-shedding will persist throughout the […]<\/p>\n","protected":false},"author":2,"featured_media":1572,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[77],"tags":[52,53,54,55,56,8,57,59,72,60,61,62,63,64,65,66],"class_list":["post-1571","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-co-za","tag-com","tag-affordable","tag-cheap","tag-cpanel","tag-development","tag-domain","tag-hosting","tag-interweb","tag-joomla","tag-registration","tag-reseller","tag-shared","tag-south-africa","tag-website","tag-wordpress"],"acf":[],"_links":{"self":[{"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/posts\/1571","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/comments?post=1571"}],"version-history":[{"count":0,"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/posts\/1571\/revisions"}],"wp:attachment":[{"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/media?parent=1571"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/categories?post=1571"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/interwebdev.co.za\/index.php\/wp-json\/wp\/v2\/tags?post=1571"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}