The Price of Mediation: How Middlemen Influence Load Shedding in South Africa

Electricity Minister Kgosientsho Ramokgopa sheds light on an intriguing and concerning issue that contributes to South Africa’s load shedding problem: the delay caused by middlemen during the procurement of essential components for Eskom’s fleet. Ramokgopa estimates that this issue reduces Eskom’s output by an average of 2,800MW, equivalent to three stages of load shedding.

The Perils of “Outage Slips”

During an interview with eNCA on the implementation of the Energy Action Plan (EAP), the Minister discussed various measures aimed at enhancing Eskom’s reliability. Among these, he emphasized the importance of streamlining the “procurement of strategic components.”

In an event where a unit trips, Eskom engineers identify the necessary replacement components and provide an estimated time for the unit’s return to service. However, according to Ramokgopa, these units often take longer to return to service than initially projected, primarily due to the sluggish procurement of replacement components, a phenomenon he termed as “outage slips.” These slips pose a significant challenge in maintaining the supply-demand balance due to the unpredictable return of units to service.

A Call to Sidestep Middlemen

To mitigate the impact of these outage slips, Ramokgopa advocates for the acceleration of procurement processes by eliminating the need for middlemen. He proposes that Eskom source the components directly from the suppliers and store them in central warehouses or the utility’s workshops.

By cutting out middlemen, Eskom can increase the Energy Availability Factor (EAF) and improve its fleet reliability. This direct procurement will expedite the return of units to service, aiding in the Minister’s broader aim to “transition South Africa out of the darkness.”

Addressing Eskom’s “People Problems”

Alongside these strategic initiatives, the Minister plans to leverage the expertise of retired or private-sector engineers to supplement Eskom’s workforce.

Previously, Ramokgopa acknowledged “people issues” within Eskom but dismissed corruption as a significant problem. Instead, he attributed many of the power station difficulties to “technical problems” and an imbalance of supply-demand.

However, Ramokgopa conceded that employee morale is a concern within Eskom, not due to leadership but from job insecurity. As Eskom continues to decommission its aging coal-powered fleet – closing the run-down Komati plant last year and planning to close another five of its 14 remaining coal-fired plants by 2030 – job losses are inevitable.

This reality disincentivizes employees, leading Ramokgopa to express, “The people needed to run these plants do not see their future at Eskom.”