BN@10: Eskomite no more, Jan Oberholzer shines a light on the future of load-shedding

Four weeks after Alec Hogg’s fascinating interview with then Eskom consultant and former COO Jan Oberholzer, the electrical engineer returned to the same venue to provide an update at the 10th BizNews birthday celebration. Having only recently departed Eskom, well ahead of the expiry of his contract, Oberholzer explained the reason for the sudden departure and shared his views on how long South Africa will be plagued by scarce electricity – extensive power cuts which the nation knows by a more polite title of ‘loadshedding’. This is the first part of his contribution, an interview with the BizNews founder.

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Edited transcript of Alec Hogg’s interview with Jan Oberholzer at the BizNews 10th birthday celebration

Alec Hogg: I only met Jan Oberholzer a month ago after reading Andre De Ruyter’s book – him being the star ‘other character’ in that book. Jan is the former chief operating officer of Eskom. Until very recently, he was on a two year contract with Eskom after a quarter century of service. But he’s left. And of course, I initially thought our recent interview may have been the reason for it, but thankfully not. When we sat here four weeks ago you said “my bloed is blou” – my blood is blue – because you’re an Eskomite. There weren’t many people in this audience who were with us that night so just to explain what being an Eskomite means….

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Jan Oberholzer: Thanks, Alec. My dad worked for Eskom for 25 years, and although we didn’t live in an Eskom house, I grew up in that environment. My father wasn’t a typical office worker; he was building wooden pole lines in rural areas. As a young boy, I’d often accompany him during weekends and school holidays to watch him work.

I then became an Eskom bursar, with the bursary initially given to my father because of his years of service. I studied for a long time, but in the beginning, rugby took precedence over studies. While I was studying, I also did vacation work at Eskom, and eventually, I worked for Eskom for 26 years, climbing through the ranks.

I’ve always learned by doing, progressing only after mastering my current tasks. Reflecting on this experience, I realise that you need coaching and mentoring. After 26 years, I ventured outside Eskom to become a contractor. The CEO later told me that I wasn’t actually a contractor, which I understood, given my strong value of ethical behaviour.

After leaving the contracting world, I spent two years in Zambia and Lusaka while my family stayed back home. Later, in 2018, I was approached to join Eskom again, and I accepted the offer. I served as the Group Chief Operating Officer for five years before being asked to stay on for two more years as a consultant.

Recently, I’ve decided it’s time for me to leave Eskom, but there’s no bad blood between us. I believe I can add value elsewhere, given my extensive experience and understanding of the South African electricity industry. The plans that we’ve put in place will make a significant improvement if implemented diligently. My new role as a consultant didn’t work for me, and I feel it’s time to move on.

Alec Hogg: Two weeks ago, you appeared fully committed. What happened?

Jan Oberholzer: I believe I can add more value elsewhere. Despite the challenges in the industry, I see positive developments. But it’s hard to switch from telling people what to do to merely advising them. I feel it’s time for me to get outside Eskom. There’s no animosity; I’ll always be available to advise my former colleagues.

When speaking openly and honestly, sometimes it’s painful for others to hear. I believe that working for Eskom means serving the country. You must contribute positively to the lives of the people. If you work for Eskom, you must serve the country.

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Alec Hogg: Working for the state or public sector often means being in service. Regarding electricity, it was the spark for the second industrial revolution, and now the world is in the fourth industrial revolution but electricity in South Africa is erratic. When will we reach a point where it’s stable?

Jan Oberholzer: Alec, the first time we had stage six load-shedding was on the 9th of December 2019. Many people don’t remember that or talk about it, and that’s quite irritating. It occurred when the state president was in Egypt, and he returned to South Africa two days later. I had to face him along with Deputy President Mabuza, Minister of Minerals and Energy Mantashe, and the minister at the time of Public Enterprises. I had to explain why it happened, using the analogy of a car.

If you consider Eskom’s power stations, the coal-fired power plant’s average age is 44 years if you exclude Medupi and Kusile, which have their challenges too. So if you have old cars and you don’t maintain them, only putting in fuel, water, and air if needed, and driving with your foot on the accelerator, you’ll eventually face challenges.

I tried to explain that our situation is like a broken car that is taken to any mechanic rather than the manufacturer, with spare parts not prescribed for that car. Deputy President Wilson seemed to understand that we need new cars, new power stations. We need more capacity, not to replace the old ones, but to add to them.

I told the President that we urgently need 4,000 to 6,000 megawatts of capacity, and that was three and a half years ago. Our old power stations are coming to the end of life, and renewables like wind and sun are not always available. We need a hybrid solution of capacity to meet the country’s demands, and we need to work together as a team in South Africa to achieve this.

Alec Hogg: But you haven’t really answered the question. How long are we still going to have load-shedding? How long will our economy still be hindered by this?

Jan Oberholzer: It’s hard to pinpoint a time frame. Eskom will continue to have significant challenges because the demand exceeds what is available, and it’s unpredictable and unreliable. But there’s a positive development with the new power station at Kusile, adding 2 100 megawatts, and another 700 plus from unit number five, which is close to three stages of load-shedding. Eskom’s focus on maintenance will also make a positive contribution.

Perhaps towards the middle, end of next year, things will turn out much better.

Alec Hogg: Interesting, because the ANC, it seems, is banking on an improvement at the beginning of next year ahead of the 2024 National Election. If the Moonshot Pact parties win the next election, what would your advice be to the potentially new minister of energy…..?

Jan Oberholzer: My advice would be to understand the ‘crystal ball,’ a long-term view of 50 years. Understand what the demand is going to be, how technology will impact it, the effect of climate change, how manufacturing processes will change. We need to concentrate on the demand and the existing energy mix to figure out what is needed for the future.

The current Integrated Resource Plan (IRP) is meaningless. People are saying we only need renewables, but what we require is a hybrid solution. Yes to solar, hydro, nuclear, hydrogen. You need to understand what you need to satisfy the demand. That’s the advice.