South Africa's Eskom to reduce power cuts but long-term outlook bleak

South Africa's state power utility Eskom Holdings SOC Ltd. is expected to announce Dan Marokane as the new CEO after searching for a candidate for more than a year, according to a report.

Eskom's spokesperson Daphne Mokwena said on Thursday that "the process is with the shareholder to finalize and make the decision," Bloomberg reported. On the other hand, Ellis Mnyandu, spokesperson of the Department of Public Enterprises, declined to comment.

A special cabinet meeting scheduled for Friday was expected to discuss the new CEO appointment. However, no formal announcement has been made yet.

Marokane, currently serving as the CEO of the cane sugar refining company, Tongaat Hulett, previously worked as Eskom's head of group capital.

The search for the new Eskom CEO started last year when former CEO Andre de Ruyter resigned abruptly from his post in February 2022 and alleged that members of the energy company were involved in corruption.

Calib Cassim, former Eskom chief financial officer, took over de Ruyter's position temporarily until a new CEO was appointed. In October, chairman Mpho Makwana also resigned, and was succeeded by non-executive director Mteto Nyati.

As far as corruption allegations on Eskom were concerned, the energy company welcomed the arrest of former short-term contract employee Zandile Rosemary Ngcobo in May over fraud and corruption allegations.

Another Eskom official Nwabisa Ngxola -- who used to work as an administrative clerk -- was sentenced to 10 years of imprisonment for defrauding the power utility of R2.6 million.

President Cyril Ramaphosa appointed electricity minister Kgosientso Ramokgopa on March 1, who, at the time, dismissed all corruption charges, saying that load-shedding issues in the country were technical and had nothing to do with "so-called corruption."

The 1998 White Paper on the Energy Policy clearly stated that Eskom's generation capacity surplus will be fully utilized by about 2007 and if timely steps were not taken, then the demand will exceed.

South Africa has been dealing with electricity issues for a decade now. Eskom is responsible for providing electricity across the country, and uses coal stations to generate 80% of the power. Marokane, if hired as CEO, will have to work on a plan to revive the troubled utility months before South Africa votes in national elections.

According to Central Bank, the energy crisis may have reduced the economic growth rate in South Africa by as much as 3.2 percentage points last year, with a survey saying the governing African National Congress could see its support dip to as low as 45% next year.