Eskom boss De Ruyter quits amid acute electricity crunch

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Eskom boss Andre de Ruyter quit this week in the midst of the most acute rolling blackouts South Africa has had since 2008.

Eskom officials were not immediately reachable for comment, but several insiders confirmed the move. Richard Mantu, the spokesperson for the department of public enterprises which oversees Eskom, referred the Mail & Guardian to the utility’s board for comment.

Independent energy analyst Clyde Mallinson said: “It’s been on the cards for some time now, where Andre has made his views very forceful, and it’s clear that he was acting as a man with nothing to lose. 

“So he basically threw down the gauntlet a couple of months ago and the challenge hasn’t been accepted. I do know that he didn’t take on the job to sort out the level of corruption and crime embedded in our whole economy, not simply in Eskom. And he hasn’t been supported on that front.

“There’s only so many death threats you can take, so many chips you can find under your front car seat. It’s just very sad. I don’t even care who replaces him because … I don’t think anyone could sort the problems,” he said, adding he believed a lot of people will leave Eskom, “people who believed in him”.

Energy expert Emily Tyler believes that “Eskom’s challenges are deeply systemic, and De Ruyter can be commended for lending the utility leadership stability in highly challenging circumstances for as long as he did”.

Just a year ago De Ruyter said he would not resign. Instead, he said he and his executives had been appointed by the Eskom board and served at its discretion, adding that the board had not “so far” had conversations on dismissing anyone. 

“It is probably more important to have continuity of management rather than to fall back into the trap that Eskom has been in over the past 10 years when we had 11 different chief executives, that lack of continuity clearly has contributed significantly to instability in the organisation,” De Rutyer said in 2021 after South Africa was once again forced to move to stage four load-shedding. 

De Ruyter has faced increasing criticism as the energy crisis has worsened, including from Mineral Resources and Energy Minister Gwede Mantashe, who, in July, said the Eskom boss and the board may not have the skills needed to revive the ailing power utility.

Mantashe told the M&G in an interview that De Ruyter would have been better suited at the power utility after the appointment of a “fixer”. 

De Ruyter has been Eskom chief executive since 15 January 2020, taking over from Jabu Mabuza, who had acted in the position after previous chief executive Phakamani Hadebe left at the end of July 2019.

Hadebe was the 10th person to resign from Eskom’s top post in the past 10 years.

De Ruyter’s resignation comes on the same day as Eskom’s efforts to have a 32% tariff increase approved by the National Energy Regulator of South Africa (Nersa) was postponed. 

In what was supposed to be the final sub-committee meeting on Wednesday on the tariff increase, Nersa said it was not ready to deliver the decision. 

“Eskom’s submissions were received in September and there was a lot of guidance needed on how to proceed. Certain numbers didn’t tally and the regulator was asked to expand the work, there are vast areas that need improvement,” Nersa said. 

Eskom is hoping Nersa will look favourably on the utility’s efforts to recoup funds owed to it by municipalities and other clients that are behind in their payments, said Hasha Tlhotlhalemaje, the general manager of regulation at Eskom. 

“What any regulator’s role is, is to determine what the efficient cost is of producing that electricity,” she said. “Nersa needs to define the efficient cost [of producing electricity] and what it would allow to be recovered by the consumer.” 

Municipalities currently owe the utility about R50 billion.

For the past month insiders have warned of impending stage eight load-shedding.

Eskom has struggled to meet electricity demand and last week it implemented stage six for the fourth time this year. The power cuts left some users without power for more than 10 hours a day. 

According to highly placed sources in Eskom, the problems stem from the disunity in the utility’s management, with members of the board and its leadership not seeing eye to eye.

One source said since De Ruyter had been appointed as chief executive, there had been a negative response to implementing his plans to improve the situation at the utility.

“There is a general discomfort with the favour De Ruyter has received from the minister of public enterprises, Pravin Gordhan, and, obviously, there are many people that are trying to expose that. There is no understanding on how things are going because De Ruyter showed he was unable to do this job early but he is still here,” the source said.

Sources inside Eskom, who requested anonymity, believe his resignation was on the cards as early as last week. Eskom’s board was under pressure because they knew he was going to resign and were scrambling to find a replacement.

Last month, De Ruyter was at the centre of a controversy regarding security checks for Eskom executives, with the utility saying it was unaware of a request dating back to June from the State Security Agency (SSA) for the chief executive’s vetting documentation.Eskom said it was inaccurate to claim that it had delayed the vetting process of its executives. The push-back came after the deputy minister responsible for state security, Zizi Kodwa, had said De Ruyter was not fully vetted because he had not provided all of the information requested by the SSA.