S. African Parliament wants to situation to improve at power utility Eskom

Parliament has committed itself to closely monitoring Eskom while it works to overcome the challenges plaguing it and to rooting out corruption at the state-run parastatal, Parliament's Standing Committee on Public Accounts (SCOPA) said after concluding oversight visits to Eskom's Medupi and Kusile power stations, whose poor performance almost collapsed the national grid over the past few years.

Power lines run from one of Eskom's coal fired power stations near Villiers, South Africa, 29 August 2019. [Photo: IC]

"The committee undertook these visits with the aim of understanding the challenges that led to the country-wide power outages early this year," said committee chairperson Mkhuleko Hlengwa.

The committee also wanted to inform itself about the cost escalations at these power stations in North West Province, said Hlengwa.

Both challenges contributed to Eskom's poor performance over the past few years and have had a negative impact on the country, according to Hlengwa.

The committee will develop a detailed report from these oversight visits, which will be tabled in Parliament, he said.

In line with the SCOPA's mandate, this will include scrutinizing Eskom's financial statements when they are submitted to Parliament, said Hlengwa.

The SCOPA appreciates the seriousness on Eskom's part of understanding the importance of the work of the committee in laying out a program of interaction in an effort to reach a solution to the current problems, Hlengwa said.

"This understanding is significant particularly because of Eskom's performance for the past few years," he said.

There have been fears for more power blackouts in the country if Eskom's financial situation worsened.

Eskom, which provides about 95 percent of the electricity consumed in South Africa, has implemented on-and-off load shedding over the past few years, seriously impacting economic growth and people's daily lives.

The utility, gripped by poor management and alleged corruption, incurred a loss of 2.3 billion rand (about 150 million U.S. dollars), irregular expenditure of 19.6 billion rand (about 1.3 billion dollars) and a debt of 380 billion rand in 2017/18.

The government has allocated billions of rand to bailout the embattled utility but with little effect.

The National Treasury told Parliament on Wednesday that should Eskom fail to implement its funding plan by the end of March next year, it will end up requiring additional funding.

This would be in addition to the special funding of 59 billion rand to be spread over two financial years from this year until 2021.