Eskom’s days as a monolithic supplier of last resort are over, says CEO Andre de Ruyter

Andre de Ruyter, CEO, Eskom

ANDRÉ de Ruyter knew the enormity of the challenges he would face when he took on the mantle of Eskom CEO at the end of 2019.

But he did not expect the extent of neglect he found at the state-owned utility, from its crumbling infrastructure to the corruption and lack of governance that had inflated Eskom’s cost of procurement so much it had created an unsustainable debt burden for the country.

Nor did he expect death threats and a volley of racism allegations.

Nonetheless, 18 months later, there is widespread consensus that De Ruyter has stabilised a sinking ship, although it still poses a formidable risk to South Africa’s economy. He has cut a significant chunk of the utility’s costs, enforced accountability at top levels of management and reduced a bloated headcount.

Most importantly of all, he has been outspoken about the fact that Eskom cannot address the country’s future power needs and he is working effectively with government and business to accelerate reform and restructure the industry in a way that will make it competitive and sustainable.

One of De Ruyter’s biggest wins was the role he played in supporting business to persuade President Cyril Ramaphosa to override entrenched ideological opposition to liberalising the power industry through lifting the licensing threshold for embedded power generation within the private sector.

Industrial companies and others had campaigned for years to be allowed to generate more of their own electricity through Solar PV installations, arguing that it was the only way to bring on additional capacity fast enough and at the scale needed to address the economy’s crippling power supply constraints.

“I think there are many things in Eskom that we can fix,” De Ruyter told Miningmx in an interview on 10 June.

“We can restructure ourselves. We can improve the processes, we can fix our plant, we can try and address our debt. But we can’t harken back to some glorious past where we are this monolithic supplier of last resort that can keep the lights on no matter what, at the sixth-lowest cost by world standards, to domestic customers and industry.

“That is not the future that we see for Eskom; we see a future where we play a smaller but still relevant role in generation.”

De Ruyter, 51, took a pay cut to move to Eskom from his previous job as Nampak CEO, and says he was motivated by an “old- fashioned sense of patriotism”.

When asked whether he ever regretted the decision, he replied: “Three times before lunch, every day.”

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