Eskom has a people problem

Eskom chair Mteto Nyati has said that the power utility’s major shortfalls over the past few months have been primarily people-related.

Speaking during Eskom’s State of the System and Winter Outlook briefing on Monday, Nyati said the board and executive committee analysed the utility’s performance over the period that load-shedding returned.

He said this was done to better understand where they had gone wrong and assist the utility in learning from its mistakes in its attempt to reach sustainability.

“What we realised was not that we have issues relating to equipment, but rather people-related problems,” Nyati said.

“That’s a good thing because it means that Eskom can address these issues.”

Nyati said these issues primarily relate to Eskom’s leadership and management, such as following standard operating procedures and holding employees accountable.

The chair added that the utility now prioritises creating and embedding a high-performance culture within the organisation.

Eskom generation head Bheki Nxumalo pointed to several skill gaps when addressing outage slips as part of the generation recovery plan.

“While most of the focus has been on the lack of skills at Eskom, many of our partners have come out to us saying that they have skills-related problems,” Nxumalo said.

“We have also agreed with our original equipment manufacturers (OEM) that they need skills capacitation. We need to look at everyone working within our fleet.”

In his concluding remarks, Eskom CEO Dan Marokane also highlighted the importance of people in the utility’s goal of becoming an “investable and sustainable company.”

“People are critical to our ability to deliver. Management is key, but we are acutely aware of the importance of giving employees a sense of purpose in their work,” Marokane said.

“It is about fostering the leadership culture necessary for us to succeed across all levels, creating a space of support but also one that is highly challenging.”

Eskom cracks down on misconduct

In addition to skills shortages, Eskom has been riddled with corruption at its power plants for years, with the power utility recently stepping in to crack down on misconduct within its generation fleet.

This has resulted in the loss of billions due to a wide variety of crimes ranging from theft and sabotage to tender and procurement.

On several occasions, the power utility has stressed that most of its roughly 40,000 employees were honest and dedicated.

However, it said that only a small minority engages in criminal activities, which must be identified and dealt with decisively.

To combat internal crime, Eskom has partnered with law enforcement officers in the Energy Safety and Security Priority Committee of the National Joint Operational and Intelligence Structure (Natjoints).

Most recently, the power utility announced that six people were arrested for their involvement in a fraudulent procurement scheme at Kusile Power Station, one of the hotbeds for incidents of corruption.

The arrests included a former Kusile procurement officer and procurement manager and followed a coordinated intelligence-driven operation.

The investigation found that a pump was unlawfully procured for R857,977 in 2018 after an identical pump with the same serial number was bought for just R18,835 in 2015.

When price changes over those three years are not considered, the new pump’s price tag was inflated by 4,455%. Eskom said the fraudulent transaction led to a direct financial loss for the power utility.

Earlier in March, Eskom also announced a flurry of arrests and provided updates on court cases against people involved in crimes against the power utility.

These cases had a financial impact of R1.09 million, of which Eskom says it has recovered R873,000.