Manyane Manyane | 11 December 2022
Eskom group chief executive officer Andre de Ruyter. ARMAND HOUGH/AFRICAN NEWS AGENCY (ANA)
Johannesburg - Eskom has taken an anti-black stance after being hostile towards black economic empowerment (BEE) and black-owned businesses. This is after the power utility cancelled the contracts of black businesses and appointed white-owned companies.
The utility has been sidelining black suppliers in the business since 2020.
The suppliers were replaced with major companies such as Sasol and Shell. Recently, Eskom appointed companies such as Hyosung Heavy Industries and Pinggao Group.
The service providers were selected to roll out its Battery Energy Storage System project – to manage demand during peak periods and support grid stability.
Hyosung is a South Korean company and Pinggao is a Chinese company. The companies were appointed in July for the project that is expected to start in June 2023.
Last month, the utility announced that it would be leasing land to four power producers (IPPs) at its Majuba and Tukuta power stations. The successful bidders were: HDF Energy South Africa, Red Rocket SA, Sola Group, and Mainstream Renewable Power Developments South Africa. All these companies are white-owned.
Before the appointment of Andre de Ruyter, Eskom used to do business with black-owned companies such as Alcon Maphera, Econ Oil and Energy, Malesela Taihan Electric Cable, Maqhilika Timber, Naledi Foundry Operation, Ntshovelo Mining Resources, Nyameza Metering. These are 100% black-owned companies.
However, Eskom terminated the contracts of these service providers, saying their appointments were irregular.
Experts said this shows that the power utility has taken a stance to be an anti-black institution under the leadership of chief executive officer De Ruyter. Former Eskom chief executive Matshela Koko said BEE policy was the biggest casualty of the government's sixth administration, adding that what was happening at Eskom was a consequence of that.
“I can say that black business is the biggest loser at Eskom under De Ruyter. The reason may be that Eskom, under De Ruyter, prefers OEMs (Original Equipment Manufactures) and big businesses like Sasol, BP, and others,” he said.
Koko added it was clear that enterprise development has been de-emphasised under De Ruyter.
“Black businesses mainly feel the effect of this. Hence, the perception that De Ruyter favours white companies over black companies,” Koko said.
The sentiments were echoed by energy expert Adil Nchabeleng, who said Eskom had taken an anti-black stance. He said Eskom could have continued to do business with black companies as it was done with white engineers in 1994 after the ANC was elected to government.
Nchabeleng said black companies were kicked out, because the current leadership was racist.
“Eskom is under a racist regime. The leaders at Eskom are racist, openly so. They are also not prepared to look into the issues that are pertaining to the supply chain. You cannot just single out a group of black companies and cancel their contracts,” said Nchabeleng.
He said the termination of the Econ Oil contract in August, which supplied Eskom with fuel oil, shows that black businesses were targeted under De Ruyter’s leadership.
“The worrying part is that Eskom is moving in a direction where it has taken an anti-black stance. There were five companies that had to pay back the money to Eskom for irregular awarding of contracts and payments and not one has made it a big issue to say white companies are corrupt within Eskom.
“This shows that Eskom is playing a very racist campaign against black companies. This is a very worrying phenomenon developing that the current regime is all white and does not care about the black people,” said Nchabeleng.
Asked how many BEE companies were currently working with Eskom, spokesperson Sikonathi Mantshantsha did not respond. Instead, he said: “All of Eskom’s contracted suppliers have to, and do, comply with all the relevant transformation and preferential procurement laws of the country.
“(They) meet all the minimum BEE requirements, particularly the government’s procurement policies, which put transformation and Broad-Based Black Economic Empowerment at the centre.
“All supply contracts have pre-determined start and end dates, which are known to all the parties ahead of any commencement of any contract.”
Following the termination of Econ Oil contracts in August, the Black Business Council accused the utility of marginalising black-owned companies and taking a step back on the transformation agenda.
The business council called on Eskom to stop with such actions and align itself with the government’s transformation programme.
‘Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER’