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Eskom Announces Record R24 Billion Loss Amid Year of Unprecedented Load Shedding

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Eskom Announces Record R24 Billion Loss Amid Year of Unprecedented Load Shedding

Eskom recently unveiled its integrated results for the financial year 2023, painting a grim picture of the utility’s dire situation.

Eskom Announces Record R24 Billion Loss Amid Year of Unprecedented Load Shedding

Rising Losses and Prolonged Load Shedding

Eskom’s net loss after tax surged from R11.9 billion to R23.9 billion, indicating a severe financial decline.

Load shedding intensified, leading to a shocking 215 additional days of power cuts compared to the previous year.

A tariff increase of 9.61% placed an added burden on consumers.

Escalating Municipality Debt

Municipal debt to Eskom has grown by R24.1 billion, reaching R58.5 billion, contributing to the company’s financial challenges.

Leadership Changes

Kgosientsho Ramakgopa took over as the electricity minister in March 2023, facing the monumental task of addressing load shedding and the broader electricity crisis.

Financial Woes

Eskom’s earnings before interest, tax, depreciation, and amortization amounted to R38.0 billion.

The earnings margin dropped to 14.7%, primarily due to soaring primary energy costs related to expensive open cycle gas turbine (OCGT) production.

A 5% drop in sales volume, attributed to load shedding and an overall economic decline, compounded the financial difficulties.

Revenue and Expenses

Despite an increase in revenue to R259.5 billion, driven by a tariff increase, this failed to offset the sales volume decline.

Primary energy expenses rose to R154.9 billion, driven by factors such as Eskom-owned open-cycle gas turbine (OCGT) costs and increasing gas and fuel oil expenses.

Eskom’s generation costs reached R106.7 billion, with higher expenditure on Eskom-owned OCGTs due to increased diesel prices and enhanced gas turbine production.

Expenditure on independent power producers (IPPs) also escalated to R41.8 billion, attributed to greater use of IPP OCGTs and rising diesel prices.

Liquidity Crisis and Debt Relief

Eskom faces a severe liquidity challenge, leading to the limitation of capital expenditure and operational expenditure savings.

The Eskom Debt Relief Act provides debt relief of R254 billion over the next three years, with liquidity support.

A key condition for this relief is the sale of Eskom Finance Company.

Load Shedding Impact

Load shedding occurred on a staggering 280 days during the year, significantly reducing supply.

Eskom’s OCGT load factor exceeded the target at 14.3%, reflecting the poor performance of coal-fired generation and lower production from renewable energy-independent power producers.

Recovery Plan

Eskom’s recovery plan aims to improve generation performance and plant reliability, with a target of a 65% EAF level by March 2024 and at least 70% by March 2025.

However, the actual EAF performance during the first two quarters of 2024 stands at 55.3%, falling below the target.

Efforts are underway to extend the operational life of the Koeberg Power Station beyond 2024.

Eskom’s financial woes and operational challenges continue to pose significant hurdles as it strives to stabilize the power supply situation in South Africa.

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Eskom Media Today

Eskom Loadshedding will continue until 5:00 on Tuesday, as previously announced

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Eskom Loadshedding will continue until 5:00 on Tuesday, as previously announced

Until 05:00 on Tuesday, stage 4 loadshedding will continue. Until further notice, Stage 2 and 4 loadshedding will take place.

Eskom Loadshedding will continue until 5:00 on Tuesday, as previously announced

Monday, 10 July 2023: Stage 4 loadshedding is being implemented until 5:00 a.m. on Tuesday due to increased demand. On Wednesday, Stage 4 loadshedding will be implemented from 14:00 until 05:00, followed by Stage 2 loadshedding from 05:00 to 14:00.

Eskom Loadshedding Today

There will be a daily implementation of this pattern until further notice. A new update will be published if any significant changes are made.

As of now, 14 252MW of generating capacity has been damaged by breakdowns, while 4 118MW of generating capacity has been out of service for planned maintenance.

As of today, Duvha, Hendrina, Kendal, Kriel, Matimba and Medupi power stations have each reactivated a generating unit.

The Arnot and Tutuka power stations each had a generation unit out of service due to a breakdown during the same period.

Tutuka Power Station’s current capacity constraints are due to the delay in resuming two generating units. In order to restore service to the generating units, Eskom teams are working around the clock.

Members of the public are being encouraged to use electricity sparingly and efficiently, and we want to thank the people who do heed the call. During the period between 17:00 and 21:00, please turn off your geysers and pool pumps as this reduces demand, alleviates pressure on the power system, and contributes to fewer stages of load-shedding.

For Further Notice Visit Official Site 

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