Nyati gets another term amid Eskom overhaul

Eskom chair Mteto Nyati has secured another term at the power producer amid a sensitive unbundling that will see the group lose control of its transmission assets — with the timing of the process a point of contention.

Electricity & energy minister Kgosientsho Ramokgopa said on Friday that the government had decided to give Nyati another three-year term, ending speculation over his future after he came under intense pressure from big business over the “slow” pace of implementing reforms.

Nyati’s tenure was set to end at the end of next month — he has been in the role since November 2023 — with his board largely credited with helping to bring the country and economy out of the load-shedding crisis.

Ramokgopa, who has enjoyed a warm working relationship with the Eskom board, said there was no need to “fix what was not broken”, backing the board to continue providing the necessary oversight of a utility that still produces about 80% of South Africa’s electricity.

The minister said Eskom was at an inflection point amid the deepest reforms in South Africa’s energy sector, which were set to reshape the 103-year-old company and required steady leadership.

“We are now entering the most treacherous phase of Eskom’s transition. This is going to be … complex and difficult [and] if not handled correctly can undermine the country’s energy sovereignty with a far more devastating impact than load-shedding had,” Ramokgopa said.

“I thank Dr Nyati for his leadership during a demanding period. The improvement in the utility’s performance reflects the work of its board, management and employees. His continued service will help carry that work into Eskom’s next phase, where the measure of success will be sustained energy security, a financially sound utility and better service to South Africans.”

Nyati has chaired Eskom during a period in which the utility moved — under the generation recovery plan — from severe power shortages to sustained improvement in generation performance.

South Africa has gone almost 500 consecutive days without load-shedding, while Eskom’s energy availability factor has reached its highest level in years.

The period has also seen changes in senior management, including the appointment of Bheki Nxumalo as group executive for generation and Dan Marokane as group CEO.

The utility is now entering a different phase of restructuring.

The government is pursuing an independent transmission system operator (TSO) that will ultimately own and control the transmission assets and operate the electricity market. The reform is intended to create greater competition in electricity supply and provide non-discriminatory access to the grid.

The reforms have put Nyati and Eskom’s board at the centre of a public dispute with business leaders over the timing and structure of the changes.

Eskom has hailed Nyati’s reappointment, crediting his leadership for a period of significant operational, financial and governance progress.

“We are rebuilding an economic asset for South Africa,” Marokane said. “The extension of Mr Nyati’s term provides continuity and leadership certainty at a time when Eskom is being positioned for long-term sustainability.

“The board has played a critical role in strengthening governance, improving operational and financial performance, advancing the restructuring of the business, and creating the conditions required for a competitive marketplace.

Marokane said Nyati was well respected throughout Eskom, as well as by the energy industry, Eskom’s shareholder and key stakeholders, including organised labour, the utility’s investor base and the wider business community.

“Eskom and South Africa are fortunate that Nyati remained available for this reappointment, and I am personally looking forward to continuing our strong working relationship.”

The Nyati-led board, which has been strengthened with technical expertise, has been credited with making important appointments in operational roles — chief among them the appointment of Nxumalo as head of generation and later the appointment of Marokane.

Nxumalo was given operational authority over power station managers, helping to steer the utility’s recent performance turnaround and reduction in power cuts. This led to the sacking of several power station managers who presided over underperforming plants.

Nyati said that being asked to continue as chair of Eskom was not a formality but a responsibility that he accepted with humility and a clear understanding of what the country expected.

“I want to thank the minister of electricity & energy, the cabinet and the president for the trust they have placed in me,” he said.

“Over the past three years, Eskom’s employees have shown what is possible. They have proved that ‘impossible’ is not a fact; it is an opinion. They have lifted this organisation from the worst crisis in our democratic history to a point where we now have excess capacity that can be used to drive economic growth.

“I look forward to continuing this work with my colleagues on the board whose experience, wisdom and commitment have already done a great deal for this organisation. We must now help our country and the Southern African Development Community region industrialise. Eskom must be more than a supplier of power; it must be a platform for growth.”

Nyati has insisted that the establishment of an independent transmission system operator — which will eventually own the transmission assets — is a material event for Eskom’s lenders and that it must be implemented in a manner that addresses lender requirements.

Deon Conradie, an independent electricity pricing specialist, said Nyati’s reappointment provided necessary continuity.

“I think Nyati’s position on the restructuring is valid. The changes have to happen, but they need to happen in the right way and at the right time, while ensuring that Eskom remains a viable business and a functioning supplier of electricity,” he said.

“They have made major progress in Eskom to reduce the outstanding debt, if you look at the last annual results. So, if ever they have an opportunity, I think they need to find a way of doing it and then do it. Because if they don’t have a proper plan, dates and an implementation plan in place, he [Nyati] is going to get a lot of flak that he is just kicking the can and wants to keep Eskom together for too long.”

Steven Mathetsa, senior lecturer at the African Energy Leadership Centre at Wits Business School, said there has been improved operational and financial performance during Nyati’s tenure, as well as adaptation to policy changes and reforms, particularly Eskom’s unbundling and plans to operationalise the wholesale electricity market.

“All of this requires grounded oversight and a strategic approach driven by the need to ensure that all stakeholders — including marginalised communities — are not negatively affected by these changes,” Mathetsa said.

“In my view, a diligent and well-thought-out approach has been taken … To date, Eskom under his leadership has demonstrated a composed approach to the multifaceted changes taking place in the electricity sector, particularly the energy transition and market reforms, which could leave marginalised communities behind if not carefully managed.”