Parliament Welcomes Eskom’s First Profit Since 2017 Amid Debt Concerns

Parliament's Select Committee on Agriculture, Land Reform and Mineral Resources has praised Eskom for posting its first profit in nearly a decade, while also raising concerns about the growing debt owed to the utility by municipalities.

Eskom reported a profit before tax of R23.9 billion for the 2025 financial year, a dramatic turnaround from a net loss of R25.5 billion the previous year. This marks the first time the power utility has returned to profitability since 2017, signaling a potential shift in its financial fortunes after years of steep losses, rising debt, and operational challenges.

Committee Commendation

Committee chairperson Mpho Modise welcomed the positive results, describing them as a critical milestone for South Africa's energy sector. He emphasized that reinvesting these profits back into Eskom's operations would be crucial for long-term stability.

"The reinvestment of the profit back into the business is key for strengthening Eskom's infrastructure and ensuring greater energy security for the country, which is critical for economic growth and attracting investment," Modise said.

Parliamentarians noted that profitability is a step in the right direction, particularly after years of financial instability that saw Eskom struggle with ballooning debt, frequent load shedding, and concerns over governance.

Growing Municipal Debt a Threat

Despite the turnaround, Modise cautioned that Eskom's financial health continues to be undermined by the escalating municipal debt burden. According to the committee, municipal debt to Eskom has increased by 27% in the past year, even after the introduction of the National Treasury's Municipal Debt Relief Programme.

The debt currently stands at approximately R103.5 billion, raising alarm about sustainability and accountability in the local government sector.

"The growing municipal debt owed to Eskom, which currently stands at about R103.5 billion, is one that we, as a committee, find extremely concerning. This debt needs to be addressed and a viable solution into the matter needs to be identified. Public entities must be kept accountable to meet their financial responsibilities," Modise warned.

Balancing Recovery and Responsibility

The committee stressed that while Eskom's profit offers hope for financial recovery and energy security, systemic issues such as poor municipal payment compliance threaten to undo the progress made. Members urged greater collaboration between Eskom, municipalities, and the Treasury to create a sustainable framework that ensures electricity revenue is collected efficiently.

Analysts note that while profitability is a positive development, Eskom still faces a complex mix of challenges, including the need for investment in transmission infrastructure, renewable energy integration, and the long-term restructuring of South Africa's electricity sector.

Looking Ahead

The committee reiterated its commitment to monitoring Eskom's performance closely, urging that the profits be used to strengthen the utility's operational capacity and reduce its reliance on government bailouts.

Eskom's performance will remain under the spotlight as the country continues its broader transition toward energy security, economic growth, and fiscal sustainability.