Big business and Eskom remain at odds over the utility’s planned unbundling, with the disagreement exposing a deepening trust deficit at the heart of an exercise the government says is central to restoring reliable, affordable electricity.
Where the disagreement stands
The tension intensified after Eskom surprised markets in December by proposing a revised approach that would have retained ownership of the transmission business. Business Leadership South Africa (BLSA) and Business Unity South Africa (Busa) reacted sharply, calling on the President to clarify government policy ahead of the State of the Nation Address.
The President subsequently restated that government has not altered its 2019 plan to split Eskom into three separate entities for generation, distribution and transmission. A presidential task team this month reaffirmed that the transmission assets will not remain under Eskom’s ownership. Despite that, scepticism from the corporate sector persists.
Business leaders say trust is thin
BLSA has publicly questioned the commitment of Eskom’s leadership to the reforms. In a sharply worded weekly newsletter, BLSA CEO Busisiwe Mavuso said she lacked confidence in the board’s commitment to the unbundling process.
“I do not have confidence the current Eskom leadership is genuinely committed to the success of these reforms. What I need to see is a board that talks of solutions rather than obstacles, that is actively engaged with lenders to chart a clear pathway and that approaches the complexity with the conviction that the outcome, a competitive electricity market with reliable, affordable power, is worth the effort. That is not what we are seeing,”
That critique signals more than disagreement about legal structures: it reflects corporate concern about governance, transparency and the utility’s willingness to work with lenders and private-sector partners. For businesses that bear the cost of load-shedding and higher electricity prices, the stakes are practical — investor certainty, the price of doing business and the ability to plan capital expenditure.
Eskom signals caution over pace
On the other side of the divide, Eskom leadership has warned that the pace and design of unbundling matters for the utility’s own financial survival. Chair Mteto Nyati has cautioned that a botched or hurried unbundling could push Eskom towards financial collapse, and the utility has argued for a phased approach to mitigate disruption and fiscal risk.
That warning speaks to a genuine tension: the need to restructure an underperforming state-owned utility while ensuring that the process itself does not precipitate insolvency, further load-shedding or elevated borrowing costs that would ultimately be borne by taxpayers and consumers.
What’s at risk for households and firms
- Electricity reliability: Delay or a poorly managed transition could hamper efforts to reduce load-shedding.
- Cost to consumers: Higher financing costs for Eskom or increased operational disruption would feed through to tariffs and business input costs.
- Investment climate: Persistent uncertainty weakens investor appetite for large-scale, long-term investments in generation and grid upgrades.
For households and companies, these are not abstract risks. Electricity interruptions raise operating costs, interrupt production and erode household incomes. At the macro level, prolonged uncertainty around Eskom’s governance and balance sheet undermines South Africa’s case for attracting concessional financing or private capital into the power sector.
Options and the road ahead
The dispute leaves three practical imperatives if the unbundling is to progress without exacerbating fiscal or supply risks:
- Clear, time-bound commitments from government on ownership and regulatory arrangements to restore business confidence.
- Transparent engagement between Eskom, business and lenders to agree sequencing that protects the utility’s liquidity while enabling private investment.
- Independent oversight or monitoring to verify that milestones are met and that governance standards improve.
With the President and a task team having restated the government position, the onus now falls on both Eskom and business to translate words into credible plans that protect consumers and secure investment. Failure to close the trust gap will leave South Africa with an unresolved reform programme and continued pressure on household budgets and jobs.
| Stakeholder | Position |
|---|---|
| Government | Reaffirmed 2019 unbundling plan (generation, distribution, transmission) |
| BLSA / Busa | Demand clarity and evidence of Eskom leadership’s commitment |
| Eskom (chair) | Warns phased approach needed to avoid financial ruin |
The unbundling debate is not merely a policy tussle; it is a test of whether South Africa can restructure a strategically vital state asset without imposing additional costs on an already-stretched economy. Business and government say they want the same outcome: reliable, affordable power. The question remains whether they can rebuild the mutual trust required to get there.
