President Cyril Ramaphosa says Eskom’s return to profitability for the first time in eight years is a clear sign that South Africa’s efforts to stabilise the power utility and end the electricity crisis are beginning to yield results.
In his weekly letter to the nation, Ramaphosa said the improved financial position at Eskom was the result of “staying the course” on reforms and investing in long-term solutions, even when under pressure.
“When we announced the National Energy Action Plan in 2022, the national power utility’s losses stood at R12.3 billion and its debt had ballooned to over R300 billion,” Ramaphosa said.
“At the time, Eskom’s auditors noted that there was ‘material uncertainty relating to Eskom’s ability to continue.’”
Ramaphosa said the turnaround was largely due to increased collaboration between government departments, the work of the National Electricity Crisis Committee (NECOM), and “the hard work by the leadership and staff of Eskom”.
He noted that reduced reliance on diesel, thanks to improved performance at Eskom’s coal-fired plants, had saved the utility around R16 billion. The number of days with loadshedding had also fallen dramatically, from 329 days in the previous financial year to just 13 in 2025.
“Eskom is to be congratulated on this achievement,” Ramaphosa said.
The utility, he said, is now in a position to invest in critical infrastructure and maintenance under its Generation Recovery Plan, with more than R320 billion earmarked for expansion projects..
But despite the progress, the Ramaphosa cautioned that “serious challenges” remain, particularly rising municipal debt. He said municipal arrears owed to Eskom had increased by 27% since the previous financial year.
“We continue to work with municipalities to come up with sustainable solutions that enable them to settle their accounts with Eskom, as this is key to its financial viability,” he said.
Ramaphosa also reaffirmed government’s commitment to broader reforms in the energy sector. “Even as Eskom continues along the path to recovery, we continue to pursue the other pillars of the Energy Action Plan with equal vigour,” he said.
These include accelerating new generation capacity, increasing private sector investment, and implementing structural reforms.
The Electricity Regulation Amendment Act, which came into force in January, allows for the unbundling of Eskom and greater private participation in the electricity market.
“This legislative amendment paves the way for a more competitive electricity market,” Ramaphosa said.
“It allows for the restructuring of Eskom into separate generation, transmission and distribution units, as well as for private sector investment and diversification that will ultimately benefit consumers.”
Ramaphosa added that Eskom, in partnership with the private sector, plans to build around 14,000 km of new transmission lines over the next decade to support the expansion of generation capacity.
He said the financial recovery at Eskom is proof of the value of consistent policy, long-term planning and effective cooperation.
“The financial improvement at Eskom bears witness to the strength of these multi-sectoral partnerships, but also to the value of consistency and forging ahead with long-term goals, even in the face of strident criticism.”
“The ongoing structural reform process represents exactly this consistency and resilience. We will continue along this recovery path across the economy to achieve our goal of inclusive economic growth that creates more jobs for our people.”
Politics
