I’m not getting ‘credible information’ out of Eskom – Brown

2015-03-15 15:00

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It was the so-called war room headed by Deputy President Cyril Ramaphosa that leaned on the Eskom board to do something drastic this week.

But according to Public Enterprises Minister Lynne Brown, the decision to suspend half the Eskom executive came from the board itself.

The shock suspension this week of CEO Tshediso Matona; finance director Tsholofelo Molefe; the man in charge of building Medupi and Kusile, Dan Marokane; and technology head Matshela Koko was decided on after a marathon Eskom board meeting that ended at 9pm on Wednesday.

According to Brown, the Eskom CEO is supposed to connect to the war room.

Matona evidently did not do this, leaving the high-level task team more or less ignorant about the thing it was supposed to be solving.

Brown told City Press on Thursday she was simply not getting “credible information” out of Eskom.

It was, however, a “cumulation of things” that led to the intervention.

The regular Eskom board meeting on February 27 had been postponed by Brown, who was out of the country.

The board was instead instructed to deal with “matters affecting Eskom emerging fromthewarroom before the board considered its strategic plan and shareholder compact for the 2015/16 fiscal year”, read an official Eskom response.

Brown then attended Wednesday’s meeting, where she “raised her frustrations” and left by 11.30am.

At 9pm on Wednesday, she got a call informing her of the plan to launch an inquiry and suspend the four executives, she told City Press.

According to her, this was the board’s solution, not her or the war room’s.

“I was told the removal of the four is not punitive. I’m satisfied with that. They must just step aside,” Brown told City Press.

She is, however, not happy with the innocuous way Eskom chairperson Zola Tsotsi tried to describe the coming probe to journalists.

He strained to frame the audit as purely a “fact-finding mission”.

“There is no investigation. There is no culpability involved here. It is an honest inquiry to establish facts,” he told journalists at a hastily convened press conference on Thursday morning.

Brown said: “I would really like an in-depth investigation. I say, do a deep investigation.”

Brown blames Eskom for the fact that she has ended up making public pronouncements that turn out to be just plain wrong – from Medupi’s switch-on date to the idea that Eskom will almost immediately “run out of money”.

“I need a real answer, not just ‘we didn’t plan for it’,” she said about the massive delays and cost overruns at Medupi and Kusile.

The grey areas Brown and, by extension, the war room, want more information about cover virtually every aspect of Eskom’s operations.

From coal supply to its true financial situation, maintenance progress and the building of Medupi – government is concerned it really doesn’t know anything at all.

At face value, it means the financial and technical situations at Eskom might be worse than is publicly known. The suspension of Marokane, in particular, suggests concerns around the state of Medupi, which is supposed to imminently deliver an added 600 megawatts to the grid.

This latest three-month investigation will hopefully fare better than the two Brown has already ordered.

In April last year, Brown gave Eskom three months to conduct an investigation into the explosion of a boiler at Duvha Power Station near Witbank. She still doesn’t have the report.

In October, she set a three-month deadline for the investigation into the collapse of a coal silo at Majuba Power Station.

That deadline has also come and gone.The inability of Eskom to properly account for these disasters was part of the reason for this week’s suspensions, Brown told City Press.

While the team to investigate Eskom fromthe bottom up has not yet been appointed, Tsotsi said on Thursday the process would be led by turnaround specialist Nick Linnell.

His company, The Project Office, is billed as an all-purpose business consultancy with services that include investigations. The Project Office’s website says the company has worked for Shoprite, HSBC, Naspers and the National Union of Metalworkers of SA’s investment arm.

War room

Eskom is clearly failing to meet the most immediate demand to come out of the war room: to reduce the spiralling unplanned outages at power plants.Parliament’s portfolio committee on energy received a presentation outlining the war room’s priorities on Wednesday.

The immediate focus is on maintenance because, “on average”, 8?000MW of Eskom’s power generation is offline due to unplanned breakdowns.

The target is to push the unplanned outages to less than 7?000MW.

“The key objective of the war room is to facilitate the creation of space to effect the maintenance to improve plant performance,” reads the presentation.As if on cue, the level of unplanned outages on Thursday spiked up to 8?217MW, leaving the country short on power again.

According to the presentation, the only thing more important than fixing the stations is sorting out the diesel supply for Eskom’s emergency plants in the Western Cape.After that, it is mostly about getting Medupi up and running within the latest deadline, which is the end of June.

Staff turnover

The churn of top executives at Eskom was already impressive before this week’s suspensions.

Of the 10-strong executive team Eskom had in 2013, only three people remain.This follows the resignations of Steve Lennon and Erica Johnson last year, shortly after Eskom lost Brian Dames as CEO, Paul O’Flaherty as financial head and human resources boss Bhabhalazi Bulunga, who went on “early retirement”.

Most of the board has also recently been replaced.

CEO

Eskom CEO Tshediso Matona only joined Eskom in October last year. If this suspension sticks, he would have lasted less than five months in what is possibly the country’s most stressful job.

Contrary to tradition, Matona had no Eskom experience and had been director-general of the department of public enterprises before the move.

His replacement for at least the next three months, Zethembe Khoza, has even less Eskom experience.

Khoza was parachuted into Eskom as a nonexecutive director in December as part of Brown’s overall reshuffling of the major state-owned enterprise boards.

Khoza has spent 27 years at Telkom, most recently as head of customer services.

The other three new acting executives are all old Eskom hands with at least 14 years at the company.Public enterprises minister says a ‘culmination of things’ led to the suspension of Eskom’s CEO and others fromthe ailing parastatal

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