South Africa’s state-owned utility, Eskom, posted a massive R55 billion ($3 billion) loss for the fiscal year ending March 2023, primarily due to a one-off charge related to the separation of its transmission unit.
Despite the loss, Eskom is optimistic about its future, projecting a profit of more than R10 billion for the fiscal year ending March 2025.
The utility, which is undergoing a major restructuring to split into three separate units—generation, transmission, and distribution—attributed its losses to a combination of factors, including underperforming coal power stations, unsustainable debt levels, rising municipal arrears, and inadequate tariffs. This restructuring is part of President Cyril Ramaphosa’s 2019 reform plan to enhance Eskom’s efficiency.
While the financial results were bleak, Eskom reported a 14% increase in revenue to R295.8 billion for the year ending March 2024. However, sales volumes fell by 3%, partly due to 329 days of scheduled power cuts, known as load-shedding, which have long hindered South Africa’s economic growth.
In a positive shift, Eskom’s power supply stabilized in recent months, with no load-shedding reported over the past nine months. This improvement has raised hopes for an economic recovery, with business confidence boosted by the more reliable power supply. Eskom now expects a financial rebound by 2025, following its restructuring and efforts to improve operational stability.
