The Unisa Graduate School of Business Leadership (SBL) held a “Distinction Dialogue: Turnaround strategy: Lessons in Keeping the Lights On” discussion at its premises, in Midrand, on August 13, in partnership with the Department of Electricity and Energy.

Electricity and Energy Minister Dr Kgosientsho Ramokgopa welcomed tangible results emerging from Eskom’s Energy Generation Recovery, with the country’s energy availability factor having improved to 85% in July, a considerable improvement on the levels of about 40% experienced during peak loadshedding.

He also highlighted new renewable energy sources being onboarded as a result of the Integrated Resource Plan.

Ramokgopa highlighted the latter as an overarching, comprehensive articulation of the energy sources underpinning electricity generation in the country, with the aim to ensure security of supply, address cost and environmental issues and ensure the country is able to industrialise on the back of this.

He also enthused that there is a greater appetite from the private sector to invest in self-generation and private offtake, with this increased competitiveness leading to greater investment in research and innovation, and building industry on the back of this new generation capacity.

Eskom group CE Dan Marokane stressed that, after diagnosing the issues, and fleshing out the generation recovery plan, there was the need for “brutal, disciplined execution” of the plan, with immediate course correction when things went wrong.

He stressed the importance of proper leadership to drive this.

Expanding on the importance of leadership, Eskom chairperson Dr Mteto Nyati highlighted the “conscious decision” of the new Eskom board to undertake engagements with stakeholders and understand the workings of the entity, with this revealing that management had been “completely disconnected” from the rest of the business.

He pointed out that these voices, which were not considered before, were pivotal in assisting with the formation of the generation recovery plan.

Nyati also noted that several systemic issues were found to be afflicting Eskom, including corruption, a weak balance sheet and a dysfunctional organisational culture.

He highlighted the importance of bringing discipline back in the leadership team to address this, as well as tightening controls, with this culture change being an ongoing endeavour.

Nyati also said that performance-based incentives were brought back as part of this culture change.

Nyati cited data compiled by the Council for Scientific and Industrial Research that estimated R2.8-trillion of losses to the country at the height of loadshedding, with companies shutting down, earnings reduced and small, medium-sized and microenterprises losing business, among other economic impacts.

Now, the energy performance turnaround has translated into confidence in the country.

Nyati highlighted that current performance levels provide predictability, which incentivises companies to reinvest in production, leads to improved ratings and impacts on the cost of capital and borrowing.

He stressed the need to maintain this, to enable the country’s growth rate to improve and societal issues to be addressed.