31/08/2026
MEDIA STATEMENT
31 AUGUST 2026
FOR IMMEDIATE RELEASE
ESKOM'S R30 BILLION PROFIT IS BUILT ON THE IMPOVERISHMENT OF THE WORKING CLASS
The South African Federation of Trade Unions (SAFTU) notes Eskom's announcement that it recorded a profit of more than R30 billion for the 2026 financial year, more than doubling the R14 billion profit it achieved the previous year. While SAFTU welcomes the operational improvements that have significantly reduced load shedding and improved electricity generation, we reject the attempt to portray Eskom's financial performance as an unqualified success.
Behind these impressive profit figures lies a far more troubling reality: Eskom's profitability has been achieved not through expanding electricity demand, supporting industrialisation or reducing the cost of electricity to consumers, but by transferring the financial burden of declining electricity sales onto the shoulders of millions of already struggling working-class households through relentless tariff increases.
Eskom's own financial results reveal the contradiction at the heart of its current business model. Electricity sales declined by 6.2% during the financial year, yet revenue increased by approximately R14 billion, reaching R355 billion, largely because of a 12.74% increase in electricity tariffs. In other words, South Africans consumed less electricity but paid significantly more for it.
This means that Eskom's growing profitability is not the product of a growing economy, expanding industrial activity or increasing electricity demand. It is the consequence of making electricity progressively more expensive for households and businesses that are already under severe financial strain.
This should concern every South African.
Electricity is not an ordinary commodity whose primary purpose is to generate profits. It is a strategic public good that underpins industrial development, employment creation, economic growth and the fulfilment of basic constitutional rights. A publicly owned electricity utility should measure its success by the affordability, reliability and accessibility of the electricity it provides, not by the size of the surplus it extracts from consumers whose purchasing power continues to decline.
Indeed, Eskom itself admits that this trajectory is unsustainable. In announcing its results, the utility acknowledged that "tariff increases alone cannot secure Eskom's future" and that future revenue growth depends on retaining existing demand and attracting new consumers.
SAFTU agrees entirely. The tragedy, however, is that government has pursued precisely the opposite approach for years. Rather than making electricity more affordable to stimulate economic activity, encourage industrial expansion and improve household welfare, Eskom has repeatedly relied on above-inflation tariff increases to compensate for declining electricity sales. Predictably, higher prices have encouraged consumers to reduce consumption, invest in rooftop solar where they can afford to do so, or simply go without electricity because it has become unaffordable.
This vicious cycle is entirely self-defeating. As electricity becomes more expensive, demand declines. As demand declines, Eskom seeks further tariff increases to recover lost revenue. Those tariff increases then accelerate the migration of customers away from the grid and deepen energy poverty among households that have no alternative source of electricity. Instead of confronting the structural causes of declining demand, Eskom continues to rely on the blunt instrument of higher tariffs, further undermining its own long-term sustainability.
The Federation is also compelled to remind South Africans of the promises made when government embarked on the restructuring of the electricity sector and the introduction of Independent Power Producers (IPPs). For years, South Africans were told that opening electricity generation to competition would reduce prices, improve efficiency and ultimately benefit consumers. We were assured that introducing private generators into the electricity market would break Eskom's monopoly, encourage innovation and create downward pressure on electricity prices through competition.
Today, those promises stand exposed as another neoliberal myth. Far from reducing electricity prices, the period during which IPPs have expanded has coincided with some of the steepest electricity tariff increases in democratic South Africa.
Every year, workers have been required to pay more for electricity despite stagnant wages, rising unemployment and an escalating cost-of-living crisis. The promise that competition would deliver cheaper electricity has simply not materialised. Instead, South Africans have witnessed the emergence of a hybrid system in which private generators enjoy guaranteed returns through long-term power purchase agreements while ordinary consumers continue to bear the escalating costs of the electricity system.
The current situation therefore raises serious questions about the direction of South Africa's electricity policy. Rather than reducing the financial burden on households, electricity sector reform has coincided with rising tariffs, growing energy poverty and increasing commercialisation of what should remain a developmental public service. Competition has not delivered cheaper electricity. Liberalisation has not produced affordability. Instead, workers continue to finance the transition through ever-increasing tariffs while private investors are insulated from many of the commercial risks inherent in electricity generation.
Equally concerning is Eskom's announcement that it intends to introduce discounted electricity prices for selected mining and refining operations in order to stimulate demand.
While SAFTU fully supports measures that strengthen domestic manufacturing, promote beneficiation and protect industrial employment, it cannot accept a situation where ordinary households continue to absorb annual tariff increases while large industrial users are offered preferential pricing. Working-class families should not be expected to subsidise discounted electricity for large corporations when they themselves are increasingly unable to afford the basic service.
This contradiction is particularly offensive in the context of South Africa's broader socio-economic crisis. Millions of households continue to confront rising electricity tariffs, increasing transport costs, escalating municipal charges, unaffordable food prices and stagnant wages. Millions remain unemployed, while many of those fortunate enough to have work continue to earn wages that leave their families below the poverty line. Every increase in electricity tariffs forces households to make impossible choices between buying food, paying transport costs, purchasing school uniforms or keeping the lights on.
What is particularly disappointing is that Eskom's improved operational performance should have created precisely the opposite opportunity. The reduction in load shedding, improved generation availability, lower diesel expenditure and declining operating costs should have enabled Eskom to begin reducing the cost of electricity to households and productive industries. Affordable electricity would stimulate economic activity, support manufacturing, encourage new investment and ultimately expand demand. Instead, the benefits of improved operational performance have largely been converted into financial surpluses while consumers continue to face higher electricity bills.
The Federation is equally alarmed by Eskom's continued support for the unbundling of the utility and the creation of a fully independent transmission system operator. Government continues to present these reforms as purely technical measures designed to improve efficiency and competition. In reality, they form part of a broader programme of market liberalisation that fragments Eskom into separate entities, opens strategic infrastructure to greater private participation and gradually transforms electricity from a public developmental service into a competitive commercial market.
SAFTU has consistently opposed this agenda because it places profitability ahead of universal access, affordability and developmental planning.
South Africa's electricity crisis will not be resolved through the further marketisation of the sector. Nor will it be solved by treating electricity as a commodity whose price must continually increase regardless of its social consequences. The country requires a publicly owned, integrated Eskom whose primary mandate is to provide affordable electricity that supports industrialisation, creates employment, reduces poverty and advances economic transformation.
SAFTU therefore calls on government to abandon its dependence on tariff increases as the principal mechanism for restoring Eskom's finances. The utility's improved operational performance should now be translated into affordable electricity for households and productive industries. Government must halt excessive tariff increases, strengthen Eskom as an integrated public utility, reject further marketisation through unbundling, and develop an electricity pricing strategy that supports industrial development rather than undermining it.
The Federation reiterates that Eskom's success cannot be measured by the size of its profits while millions of South Africans sink deeper into energy poverty. A public utility exists to serve the public interest, not to maximise financial returns at the expense of workers, pensioners, the unemployed and poor communities.
The true measure of Eskom's success will be the day when every household can afford electricity, every factory can produce competitively, every small business can grow because of affordable energy, and electricity once again becomes the foundation of an industrialising and developmental South African economy rather than another source of financial hardship for the working class.
A statement was issued on behalf of SAFTU by the General Secretary, Zwelinzima Vavi.
For media inquiries, contact the National Spokesperson at�Newton Masuku�[email protected]�0661682157
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