Eskom, South Africa’s embattled national power utility, has welcomed a credit rating upgrade by S&P Global Ratings, reflecting increased confidence in its financial and operational recovery efforts. The ratings agency raised Eskom’s long-term global-scale foreign and local currency outlook to “positive” from “stable,” citing the impact of government interventions, including a substantial R254 billion (£10.9 billion) bailout enacted in 2023.
Eskom’s CEO, Dan Marokane, described the development as a testament to progress in stabilising the utility’s finances and reducing operational disruptions. He highlighted savings of over R16 billion achieved by minimising the use of diesel for emergency power generation and improving overall electricity supply. These measures have contributed to a significant decline in rolling blackouts—an issue that has plagued South Africa for over a decade.
In addition to upgrading Eskom’s national-scale issuer credit rating to “zaBBB+,” S&P maintained its “B” rating on senior unsecured debt and “BB-” on government-backed debt. The outlook revision signals confidence in Eskom’s capacity to sustain operational gains while reducing reliance on state support. Marokane emphasised that maintaining this momentum would be crucial to securing long-term profitability and energy security.
This positive development underscores Eskom’s critical role in South Africa’s economic recovery efforts, even as it faces significant challenges in balancing debt obligations and infrastructure upgrades. Stakeholders have praised the rating shift as a signal to investors of Eskom’s improving fiscal health, though analysts caution that systemic energy sector reforms remain vital for sustained progress.
