Kiss Eskom goodbye

Dawie Roodt, the chief economist at Efficient Group, predicts that South Africa’s state utility Eskom will follow the same path as South African Airways (SAA) and the South African Post Office (SAPO), claiming it will “simply come to an end”.

He stated that Eskom is financially and operationally bankrupt, with its workforce being overpaid.

He compared the situation to the failure of SAA, Denel, and SAPO, predicting a similar fate for Eskom. Roodt expects only Eskom’s transmission network to survive, considering it a natural monopoly.

He advocated treating Eskom like a private sector company and placing it into business rescue, leading to job losses. Roodt also mentioned the increasing role of the private sector in electricity generation, a trend supported by research from RMB Morgan Stanley predicting that by 2025, private electricity generation will exceed Eskom’s output.

Despite the rise in alternative energy sources, RMB estimates a power supply deficit will persist due to the deterioration of Eskom’s generating fleet.

Read the full report here.