Eskom's board is to review the basis on which it pays bonuses to ensure that keeping the lights on is a management priority, says chairperson Valli Moosa.

But in an interview yesterday he defended market-related pay packages, and paid tribute to Eskom's top management team for averting the collapse of SA's power system at the height of the power crisis in January. "I have seen companies fall apart under far less pressure," he said.

He was responding to criticism of Eskom bonuses and pay for executives and directors over the past three years in the run-up to the power crisis. Eskom is due to announce results for the year to March next month. Moosa, whose contract as chairperson expires in four weeks, would not be drawn on how much Eskom might pay out in bonuses for the year.

Moosa said executive performance contracts were a hangover from the time when keeping the lights on was taken for granted. Now no one priority dominated, and often there was a long list of detailed technical targets to be met.

Experience of a crisis

"Not having had the experience of a crisis, we didn't structure key performance indicators to take account of that." A key indicator now was keeping the lights on. The board was looking at key performance indicators and bonus structures.

Eskom restructured its top management team after January's blackouts, putting in a six-strong executive committee, nearly all new in their jobs, and installing two chief operations officers - Brian Dames and Erica Johnson - to support CE Jacob Maroga, in his post just more than a year. Insiders say performance contracts for power station managers have been tightened up to focus them more sharply on ensuring security of power supply.

No successor to Moosa has been announced. He is not available for another term, and plans to leave next month, emphasising he had always made it clear he would serve only one term as Eskom's chairperson. There has been talk about a return to active politics after he was voted in at number 16 on the African National Congress's national executive committee list at the Polokwane conference.

Nersa decision decisive break

But while he continues to enjoy party political work, he says he is not looking to go back to politics but wants to spend more time in the private sector.

This week's tariffs decision by regulator Nersa was a decisive break with old-style thinking on the power sector. And though the power crisis will not be over for years, Nersa's decision was the last piece of the puzzle so that Eskom now has all the essential building blocks needed to get out of the crisis.

"There's been a change of mindset on funding and on tariffs," Moosa said. Government departments were now on side, and the Nedlac process was crucial. Eskom's building programme was on track. Its management team was up to the job.

"There is an acceptance that we are not going to be able to have extremely low-cost electricity. It's not going to continue to be our competitive advantage in the long run," Moosa said.

Eskom reported yesterday that coal stocks at its power stations, which fell to an average of only 12 days at the height of the power crisis in January, were back at 20 days by Friday, and were now just over that level. Nersa is looking at making it a requirement of Eskom's licence that it hold at least 20 days of coal stocks.

Business Day