Eskom coming to its end

According to Dawie Roodt, the chief economist of the Efficient Group, Eskom, South Africa’s power utility, is heading towards a similar fate as other struggling state-owned enterprises like SAA and the Post Office.  

Roodt believes that the private sector will take over Eskom’s functions, not through official government policy but by generating its own electricity. He attributes Eskom’s decline to poor management and its inability to provide reliable electricity.  

Roodt predicts that Eskom will continue losing customers and eventually cease to exist, with the private sector stepping in to meet the country’s power needs. However, he believes that the transmission network, which is a natural monopoly, will likely remain in state hands due to the high cost and complexity of building a national electricity network.  

Roodt suggests that the distribution networks may become privatized, despite resistance from municipalities that earn significant revenue from them. He also highlights Eskom’s substantial debt burden of R439 billion, with the government planning to assume around half of the debt.  

Roodt criticizes the recent salary increase for Eskom employees and describes the company as mismanaged. The fate of Eskom’s debt remains a key question. 

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