South Africa's state-owned power utility, Eskom, has reported a second consecutive year of profitability, with group profit after tax rising to R30.3 billion for the financial year ended 31 March 2026, up from a restated R14 billion the previous year, even as industrial electricity demand fell sharply.

The results mark a continued turnaround for a utility that in recent years implemented extensive rolling blackouts — known locally as load shedding — which at their peak in 2023 saw large parts of the country losing power for many hours a day, weighing heavily on economic output.

The utility said its earnings before interest, tax, depreciation and amortisation (EBITDA) margin improved to 30.63%, from 28.75% in the previous year, driven by improved plant availability, cost discipline and reduced reliance on emergency diesel generation.

Revenue grew 4.1%, supported by a regulatory tariff increase of 12.74%, but overall sales volumes declined 6.2% to 178 terawatt-hours (TWh). Industrial demand alone fell by 9.7 TWh, or 22.5%, year-on-year — a decline that partly reflects the broader pressures on South Africa's energy-intensive mining and manufacturing sectors, long the backbone of Eskom's sales base, as well as customers shifting to self-generation such as rooftop solar.

Data centres and crypto mining targeted as new load

To offset the drop in industrial consumption, Eskom's Distribution division said it is pursuing a diversified sales-retention strategy that includes structural growth into data centres and electric-vehicle charging, alongside wheeling optimisation, renewable power purchase agreements, flexible load activation, and negotiated pricing agreements with smelter customers.

The push into data centres comes as cloud and AI-driven computing demand has been expanding across Africa, with South Africa the continent's most developed data-centre market.

Notably, the strategy includes a Bitcoin mining pilot, positioned as a form of flexible industrial load — a category of demand that can ramp up and down in line with grid conditions. These initiatives are aimed at stabilising sales at around 178 TWh over the medium term, with Eskom projecting potential growth as new products and customer segments come online.

The utility currently has an estimated surplus generation capacity of between 2 gigawatts (GW) and 3 GW over the next few years — a reversal from the constrained system margins of recent years. Eskom says the surplus introduces new risks to revenue and asset utilisation even as it eases supply pressure.

Security upgrades

On the security side, Eskom said it has migrated its Online Vending System (OVS), the platform used to generate prepaid electricity tokens, to a more secure environment. The move is intended to curb the generation of illicit prepaid tokens and reduce associated revenue and energy losses. Prepaid electricity is widely used by South African households, and reports of criminals exploiting the token vending system to issue fraudulent credit have circulated for years.

Eskom said it is also accelerating the rollout of a new secure vending platform to replace the current system, alongside broader cybersecurity efforts that recorded no "Priority 1" incidents during the financial year.

Leadership commentary and investment plans

Eskom chairman Mteto Nyati said the results reflect the utility's shift "from recovery to transformation," while group chief executive Dan Marokane said profits were being reinvested into infrastructure and the technologies driving Eskom's decarbonisation efforts.

The utility's capital expenditure programme is set to grow from R45 billion annually in FY2026 to over R70 billion annually from FY2029, with total planned investment of R343 billion across the group over the next five years.

Source: Eskom