by Chris Yelland, investigative editor, EE Publishers

We bid farewell to Brian Dames, the outgoing CEO of Eskom, after his last day at the utility yesterday. With the earlier departure of former Eskom financial director, Paul O'Flaherty, and head of communications, Hilary Joffe, this signals the end of an era - short though it was, at about four years... (read the full article here)

While Dames' departure may be understandable - the burdens of office of the Eskom CEO are particularly onerous these days, and he indicates that he needs to get a life again - it surely cannot be said that Dames has achieved success. In fact, by leaving before the end of his term at a critical stage in the construction of the new-build programme - which is running three years late and which he and O'Flaherty led - Dames has surely failed in the mission and goals that he would have set himself upon taking office.

The reality is that the utility is facing enormous problems which are converging at a time when Eskom has been left with an acting CEO with no direct experience of running a major state-owned enterprise and business the size of Eskom, or managing projects of the size and technical complexity of Medupi and Kusile

The longstanding generation capacity crisis has led to the invoking of emergency protocols on at least three occasions since November 2013 in order to stave off a national power blackout. This has forced regular mandatory load curtailments by Eskom's largest industrial customers - 32 of whom consume some 45% of the electricity generated by the utility - as well mandatory rotating load-shedding of industrial, commercial, agricultural and domestic customers country-wide for one day in February 2014.

To meet demand, an aging Eskom generation fleet is running flat-out with unacceptably low generation reserves. Coupled with deferred maintenance at its coal-fired power plants due to the generation capacity shortages, this is resulting in high levels of unplanned outages, with plant availability dropping well below 80% - significantly lower than industry norms. This effectively further reduces availability of already low generation capacity,

It has also resulted in Eskom having to run its emergency reserves - 2426 MW of diesel powered open-cycle gas turbines (OCGTs) in the Western Cape - for extended periods. The R2-billion budgeted by Eskom for diesel fuel in the financial year ending 31 March 2014 has risen to R10-billion, resulting in a cash-flow crisis which the utility claims is affecting other necessary capital and operational expenditure... (more)

by Hans van de Groenendaal, features editor, EngineerIT

ICASA did not follow the rules... but the South Gauteng High Court has allowed lower asymmetrical mobile termination rates to be implemented for six months. Lower rates are in the public interest interest, says the judge!... (read the full article here)

On Monday 31 March 2014 the South Gauteng High Court ruled that new call termination regulations issued by the Independent Communications Authority of South Africa (ICASA) are "unlawful and invalid". However, the declaration of invalidity has been suspended for six months, which means that the new call termination rates announced on 29 January 2014 became effective on Tuesday 1 April 2014. ICASA has been given six months to review the regulations and warned to follow the rules.

Clearly ICASA and the industry will have to negotiate some high seas before the next round in six months time. In the interim Telkom Mobile and Cell C are smiling.

Under the court ruling, for the next six months Cell C and Telkom Mobile will be charging Vodacom and MTN significantly more (44 cents) to terminate a call on their networks than Vodacom and MTN can charge them (20 cents). Both MTN and Vodacom opposed the new regulations, arguing that Cell C should not have the benefits of asymmetry as it is not a new entrant, and that ICASA did not follow the correct process in determining the rates.

In a wise move to prevent the urgent interdict by MTN and Vodacom from being granted, ICASA announced that it would re-look at the call termination rate cuts set out in the regulations for 2015, 2016, and 2017, and published urgent amendments to the regulations in the Government Gazette which repealed all the rate cuts except the 20 cents /44 cents adjusted call termination rates for 2014. The judge was clearly not fazed by this move.

MTN told the court that the new mobile termination rates would cost the company R450-million in revenue if the new rates were implemented. CEO Zunaid Bulbulia also warned that the rate cuts could lead to "Eskom-type" rolling network blackouts "because we just don't have the free cash in our business".

Was Zunaid using simply using fear tactics by claiming poverty? Is MTN that poor, and can MTN really afford to alienate customers with lower network availability and increasing numbers of dropped calls due to network congestion?

Vodacom used similar arguments when the company said that the new mobile termination rates would mean less money for Vodacom to invest in network upgrades and in bringing overall call costs down... (more)