Q&A with André de Ruyter: Can corruption at Eskom ever be rooted out?

ANDRÉ de Ruyter has been dominating the news this entire week following the publication – and pirating – of his memoir “Truth to Power”, detailing his three years as Eskom CEO.

The revelations have reverberated through the corridors of power and he has been accused of even more perfidy and betrayal than when he spoke to eNCA earlier this year.

This week he spoke to Independent Media about the toll all of it has taken on his life and his family, what it will take to rid South Africa of load shedding once and for all and whether Eskom can ever rid itself of the corruption that has become a cancer that threatens the entire country.

Independent Media (IM): How likely is a total collapse of the grid and do you have any expectation of prevention or remedy given the current so-called leadership?

André de Ruyter (AdR): A grid collapse would be a catastrophic event that will require weeks to recover from. Fortunately, Eskom has excellent people running its System Operator, and as long as their independence to make decisions to keep the system stable is maintained, a collapse should be avoidable by using further stages of load shedding.

IM: At least one attempt has been made on your life. The burden of the task of saving Eskom has been enormous. How have you and your family coped with this?

AdR: The Eskom job is not a run-of-the-mill executive job. It imposes extraordinary stresses on the incumbent. My family and I are taking time to regroup and take a long-planned holiday before we tackle the next chapter in our lives.

IM: What is the reluctance to look at renewables considering we have plenty of solar and wind power to harvest? Is the problem structural or personality or vested interest driven?

AdR: South Africa is blessed with abundant energy resources, including coal, wind and solar. As global pressure to address climate change increases, SA, as the twelfth biggest carbon emitter in the world, will have to clean up its act not to fall foul of carbon border taxes on our exports.

We also desperately need more generation capacity, which renewables can provide in a fifth of the time required for new coal fired generation. We should not allow an outdated fixation on so-called baseload generation, or misplaced resource nationalism, make us fall behind the rest of the world on accelerating our just transition to a cleaner and greener energy system. This will allow us to grow our economy, create new jobs, clean up our environment and permanently solve the energy crisis.

IM: Can the corruption at Eskom ever be rooted out? And to what extent are its breakdowns sabotage or just a sheer lack of skills and maintenance. How bad is the generating stock?

AdR: Corruption is deeply rooted in Eskom, and will only be eradicated through a truly extraordinary effort from law enforcement agencies. According to NUM, who are very familiar with what goes on in our power stations, a significant part of load shedding can be attributed to corruption and sabotage, which is often linked to corrupt activities.

We can choose to spend ever-increasing amounts of money on trying to turn around poorly maintained stations that are approaching their end of life, or we can pivot to a new electricity system in which private sector investment in generation frees up capacity and scarce capital for Eskom to expand the transmission grid.

IM: What do you think of the impression created by the government distancing itself from you, and making you the fall guy for the Eskom debacle.

AdR: The energy crisis manifested itself long before my tenure. While it’s easy to scapegoat, the historical roots of the crisis in poor policy choices and poor execution are irrefutable. Rather than casting blame, the country would be far better served by a decisive intervention to take the steps needed to resolve the crisis. We don’t have any time to waste.

IM: Who, in your opinion, would be the best person to take over at Eskom now and get the country out of load shedding?

AdR: Pinning our hopes on one individual, no matter how competent, is not going to solve the crisis. Pining nostalgically for the Eskom of yore is also not going to cut it. We should rather collectively and urgently decide on what needs to be done, and then get all hands on deck to implement the plan. We cannot afford continued policy misalignment and procrastination.

IM: How do you feel about Pravin Gordhan's comments that your book and its contents have taken the country back to “swart gevaar” tactics?

AdR: Anyone who has read the book will be aware that I am absolutely do not look at our problems through a racial prism. I am, however, critical of repeated policy missteps dating back to 1998, which are the real cause of our energy crisis. The issue is not race at all, but policy and implementation. And this has nothing to do with race, but everything to do with making the right choices to move the country forward in the interests of all South Africans.

BOOK EXTRACT: André de Ruyter’s A Truth to Power: My three years inside Eskom

Blurb

When André de Ruyter took over as Eskom CEO in January 2020, he quickly realised why it was considered the toughest job in South Africa.

Aside from neglected equipment, ageing power stations and an eroded skills base, he discovered that Eskom was crippled by corruption on a staggering scale. Fake fuel oil deliveries at just one power station cost Eskom R100 million a month; kneepads retailing for R150 a pair were purchased for R80 000; billions of rand of equipment, supposedly housed in the company’s storerooms, was missing.

Faced with police inaction, he was compelled to plunge into a world that was foreign to him – a world of spies and safe houses, of bulletproof vests and bodyguards. In Truth to Power, De Ruyter tells the behind-the-scenes story of how he launched a private investigation that exposed at least four criminal cartels feeding off Eskom. While fighting this scourge, he had to deal with political interference, absurd regulations, non-paying municipalities, unfounded accusations of racism, wildcat strikes, sabotage and a poisoning attempt.

De Ruyter takes the reader inside the boardrooms and government meetings where South Africa’s future is shaped, with ministers often pulling in conflicting directions. He explains how renewable energy is the cheapest and quickest solution to our power crisis, in spite of fierce opposition from vested coal interests.

De Ruyter candidly reflects on his three years at the power utility, his successes and failures, his reasons for leaving and his hopes for the future. As someone who worked at the highest levels of the state but is not beholden to the ruling party, he is uniquely placed to speak truth to power.

About the author

André de Ruyter was raised in Bronkhorstspruit and Pretoria. After holding executive positions at Sasol and heading up Nampak, he served as Eskom CEO from January 2020 to February 2023. He remains keenly interested in synchronising economic growth, job creation and environmental benefits through a just energy transition.

Extract

On the morning of 8 September (2022), I received a series of urgent WhatsApp messages from Ayanda Dlodlo. The former cabinet minister was now the bank’s executive director for Africa. She wanted to see me.

As minister of state security, Dlodlo had been a member of the panel that interviewed me for the Eskom job. She is well known as a strong proponent of using clean coal to generate power. For many years, carbon emitters around the world have punted the alluring prospect of clean coal. It is as oxymoronic as it sounds. Capturing carbon emissions, collecting them, compressing the gas and building a pipeline to a suitable geological structure where the carbon emissions could be stored underground only makes sense where you have existing infrastructure, like the depleted oil and gas fields in the North Sea. Doing it in South Africa for plants that are decades old is literally a pipe dream. That does not prevent coal advocates from punting this as an alternative to prolong the life of coal – but it is an argument with no substance and no semblance of economic reality, particularly when compared to the immediately available and cost-competitive alternative of renewable energy.

We met at the offices of the World Bank, where Dlodlo indicated that she was on her way back to South Africa. She expressed her willingness to help navigate some of the political obstacles facing us. It was a friendly and constructive talk, but in the back of my mind I kept thinking of her close relationship with Mantashe. Anything I said would be relayed to him.

I explained to her why I supported nuclear power but stressed that it would take fifteen years before we reaped the benefits. Our needs were so urgent that nuclear could not be the only solution. Unsurprisingly, she brought up clean coal, upon which I pointed out the high initial cost of that method. The price we pay currently for generating power with ‘dirty coal’ is already higher than that of renewable energy. With clean coal, it would be prohibitive.

After the meeting with Dlodlo, we attended a World Bank panel discussion on our Just Energy Transition programme. The 156 attendees lapped up our presentation.

Representatives from the bank labelled it a ‘world-leading innovation’ with regard to energy transition, while delegates from India, Indonesia and Vietnam said they wanted to learn from us.

Next followed a series of meetings with, among others, Victoria Kwakwa, vice-president of the World Bank for Eastern and Southern Africa, and Axel van Trotsenburg, managing director of operations. Van Trotsenburg asked me to open proceedings with a general introduction. I said we had the option to put a lock on the gate at Komati and to walk away, but we didn’t want to do that. We had a moral obligation to the workers and the surrounding communities. We wanted to create a new future for them, specifically in Mpumalanga. The ideal region for generating solar power is the Northern Cape, but you cannot expect a million people to uproot themselves and move there. It’s just not going to happen. And we would create huge social instability and misery if the coal-fired power plants were shut down with no substitute to fill the economic void they would leave.

Van Trotsenburg’s reaction to my off-the-cuff speech was short and to the point: ‘Well, after that tour de raison the only question I have is: Can we do this more quickly?’

The World Bank’s one point of concern was the conflict between what I was proposing and the public pronouncements about Eskom’s future made by South Africa’s cabinet ministers, Mantashe prime among them. Questions about Mantashe’s statements often popped up in these kinds of forums. I wasn’t prepared to lie and defend him, but just answered as honestly as I could. In this case, I replied that we could not ignore him, since he was the energy minister, but that we did not think his plans were feasible. These included converting coal-fired plants that were nearing the end of their life cycle into gas power plants.

I told the bank officials that burning gas at 1 600 metres above sea level is far from ideal. You lose about 20 per cent of the plant’s potential efficiency due to the lower air pressure and oxygen levels. In addition, you have to pay a transmission fee to use the gas pipeline, increasing the price of electricity substantially. And then there is the immense cost of converting the current system. We had crunched the numbers, and they just didn’t add up.

If your intention is to retain the power station as a facility, our proposal of repurposing for renewables is the way to go. You can stimulate economic activity in the surrounding areas by using wind and solar power and establishing training and manufacturing facilities. That makes more sense than bringing gas in, which is just another fossil fuel in any case.

My answer seemed to satisfy Van Trotsenburg and his colleagues. I found it interesting that many of the international role-players caught on fairly quickly and didn’t really take Mantashe too seriously. For example, they would say, ‘We know it won’t work, but what do you think of his plans?’

Our allies abroad are rather sympathetic about the situation. Their general attitude is: We know you have politicians that make it impossible to do your job. We have that as well.

* Truth to Power is published by Penguin Random House and retails at R340.