Business Leadership CEO Busi Mavuso has hailed Eskom’s return to profitability for the first time in eight years, saying it strengthened the country’s economic foundation.
The power utility, which had been dogged by endless load-shedding due to breakdowns and poor maintenance of its coal powered power stations, posted a profit before tax of R24bn for 2025, as a combination of reduced reliance on costly diesel-fired open-cycle gas turbines and improved coal-fired plant availability trimmed the diesel bill by R16bn.
The performance prompted the management to pledge more than R320bn in capital expenditure over the next five years, a sum that could reshape investment flows in the SA energy sector.
The 98% reduction in load-shedding between 2023 and 2025 contributed to the positive results among others.
“Eskom’s return to profitability after eight years offers some welcome positive news for the power utility and the broader economy. I want to congratulate Eskom for its financial results released last month, which showed it made a profit before tax of R23.9bn,” Mavuso stated in her weekly newsletter on Monday.
“It is the first time the utility has posted a profit in eight years. I was impressed that this was achieved not just from higher tariffs, but from a fundamental and significant improvement in the operations of the state-owned entity.”
Mavuso warned, however, despite the gains, challenges remained, “including a municipal debt increase of 27% to R94.6bn, delayed clean audit opinions due to compliance issues and targets for the energy availability factor yet to be met”.
She said load-shedding was damaging to Eskom for many reasons, “but one obvious consequence was that it had less electricity to sell and therefore less revenue it could earn. It also meant that Eskom ran its diesel-based open-cycle gas turbines (OCGTs) much more, which cost considerably more than its other electricity production”.
“The significant improvement in performance of its main fleet has enabled it to not only be a more reliable supplier of electricity, but also to use the OCGTs much less. The reduction in load-shedding, while hugely beneficial to the whole economy, has also been good for Eskom’s revenue.
“Profits were also substantially helped by a favourable settlement with Sars over fuel levy rebates, which accounted for half the total. Overall, Eskom managed to grow revenue by 15% while reducing the cost of primary energy by 14%. That is a significant achievement and CEO Dan Marokane and the board deserve congratulations.”
The Eskom turnaround has positive macroeconomic implications, in providing stable electricity to the economy, but also in reducing the fiscal risks to the state, the BLSA CEO said.
“That can translate into improved overall creditworthiness of the state and with it, improved credit ratings. All South Africans are already benefiting from a more reliable power supply and the confidence that brings to investment and economic activity.”
She said this year’s results demonstrate that operational excellence and financial discipline are achievable at Eskom when there is sustained focus and partnership between the utility, government and the private sector.
“The challenges that remain, particularly municipal debt, are significant, but they are not insurmountable if approached with the same determination that has delivered the improvements we’ve seen this year. CEO Dan Marokane and his team have earned the breathing room to tackle these remaining issues. Business stands ready to continue supporting this progress, because Eskom's success is foundational to SA's economic future,” Mavuso said.
“On the whole, this year’s results show that Eskom is getting a grip on its many performance challenges, with significant improvements in many areas of how the utility is run. That can start to rebuild confidence from the public and other stakeholders that the SOE has a clear future as an efficient and competitive electricity producer.
“The improved financial performance also gives it a path towards being able to raise debt in the markets to support investment in capacity. Thanks to this year’s performance, that is now looking feasible, provided the municipal debt issues can be dealt with.”
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