Despite an “exceptionally poor” performance in its 2024 financial year, state-owned energy utility Eskom said it expects to post a profit for the first time in eight years in the year ended 31 March 2025.
Speaking to the media on Thursday, board chairman Mteto Nyati said the previous year, to end-March 2024, saw 329 days of load shedding – since the start of the new financial year, there have no rolling power cuts at all (outside of load reduction in areas where electricity theft is high).
“The fact that we had 329 days of load shedding is not something we are proud of, as this is the highest [number of] days of load shedding that we have ever had as a company [in a single year],” said Nyati.
“On the back of that, we had to spend a lot on diesel – about R34-billion – and this was largely because we were doing a lot of maintenance. In the first six months [of the 2025 financial year], we had 250 days of no load shedding. And in terms of savings on diesel, we saved R12-billion.”
He said Eskom expects to report in the region of R10-billion in profit for the current financial year.
Eskom reported a net loss before tax of R25.5-billion in 2024, an improvement from the R34.6-billion loss the previous year. CEO Dan Marokane highlighted the strong links between the utility’s operational performance and its financial outcomes, citing the decline in plant availability from 56% in 2023 to 54% in 2024, 329 days of load shedding and 19.9TWh in energy losses due to electricity theft as some of the factors contributing to poor outcomes. Worryingly, municipal debt ballooned to R74.4-billion from R58.5-billion in 2023.
Tariffs increased by 19% and, although sales volumes declined by 3% year on year to 183TWh, revenue increased by 14% to R295.8-billion. The losses after tax doubled from R26.1-billion in 2023 to R55-billion in 2024.
Outlook
One of Eskom’s key areas of focus following the upgrade of prepaid metres is the retrieval of revenues from non-paying customers. Marokane said the key change process revealed that 2.1 million customers were not paying for electricity, amounting to a revenue loss of around R30-billion/year. Eskom expects sales to increase by between 2% and 3% in the current financial year.
Marokane said the outlook for load shedding for the rest of summer is positive, with Eskom’s focus on maintenance helping to keep unplanned outages between 11.5GW and 12GW, below the 13GW target. Eskom plans to bring back an additional 2.5GW of generation capacity currently out of service due to maintenance in preparation for the 2025 winter season.
Read: ‘South Africa can’t afford this’: Eskom price hike plan under fire
Year-to-date performance in the current financial year suggests Eskom has turned the corner, but Nyati warned that there are many problems that still need to be solved. Focus areas include reducing emissions, further unbundling the business, incorporating cleaner generation technologies, modernising the grid and addressing the municipal debt problem.
“We are starting to see the benefits of what we have done in the 2024 financial year, and performance has improved quite a lot. But there is a lot that needs to be done” beyond simply ending load shedding, said Nyati. – © 2024 NewsCentral Media
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