BANKS DODGY DEALS CAMPAIGNS
Sections
Banks Dodgy Deals Campaigns
Our campaigns
Banks and Climate
Banks and Human Rights
Banks and Nature
Our projects
Tracking the NZBA
Banks and Russia
Banks and Steel
Tracking the Equator Principles
Tracking the PRBs
Find a Better Bank
Banks and the OECD Guidelines
Media
News Publications
Raiffeisen Out! Bank.Green End Coal Finance Plastic Banks Tracker Defund TotalEnergies Financial Exclusions Tracker Equator-Complaints.Org Don't Buy into Occupation Banks & Biodiversity Forests & Finance Drop JBS StopEACOP Fossil-Free Finance
BankTrack
About BankTrack Organisation Our team Our board Our annual reports Funding and finances Guiding principles Our history BankTrack in the media Team up with us Our privacy policy Donate Visit us
Successes Contact BankTrack
Donate Mailing list Facebook Twitter Linkedin Login
Home › Dodgy Deals ›
Dodgy Deal
EskomSouth Africa

Company – On record

This profile is no longer actively maintained, with the information now possibly out of date
Last update: 2018-08-28 00:00:00
One of Eskom's coal power plants, the Majuba coal power plant in Mpumalanga, South Africa. Photo: Gavin Fordham via Flickr (CC BY-NC 2.0)

Company – On record

This profile is no longer actively maintained, with the information now possibly out of date
Last update: 2018-08-28 00:00:00
Why this profile?

Why this profile?

Eskom is part of a group of 31 companies which are responsible for half the world's installed coal power capacity of 983,000 MW. Eskom's operations havehighly adverse on people and the environment amongst others related to pollution and water use. The greenhouse gases resulting from Eskom's existing coal power plants (with a total capacity of 39,456 MW) are completely at odds with the Paris Climate Agreement which calls for a maximum of 1.5C to global temperatures rises.

What must happen

Following the Global Coal Exit List, financial institutions should refrain from providing any financial services to Eskom, especially if funding would be allocated to maintenance, repairs or expansion of existing power plants. Banks should urge Eskom to decommission its coal power stations sooner than the 2050 goal set by the utility and direct their capital at energy efficiency and renewable energy financing opportunities.

About
Sectors Coal Electric Power Generation, Nuclear Electric Power Generation
Headquarters
Ownership

Eskom is wholly owned by the South African government.

Subsidiaries

Eskom is a South-African energy company, founded in 1923, and the world's eleventh-largest power utility in terms of generating capacity. In 2022, it had an installed generating capacity of 47,145 MW, of which 39,456 MW (83.7%) was from coal power plants and 1,854 MW from nuclear power. Eskom generates, transports and distributes approximately 90% of South Africa's electricity and approximately 40% of the electricity consumed in the whole African continent.

Impacts

Impact on human rights and communities

Pollution and health impacts

Eskom is the world’s largest single emitter of toxic sulphur dioxide gas and has been called one of the world’s worst polluters. In many areas of South Africa, particularly those close to power plants, ambient levels of nitrogen oxide, sulphur dioxide, ozone, and particulate matter exceed maximum national standards. 

These emissions standards were introduced in South Africa in 2010, giving power stations 10 years to comply with stringent limits for pollutants. Stations were required to install flue gas desulphurization (FGD) technology, which removes sulphur dioxide before it’s released into the environment. But as of 2022, only one coal-fired power station is in full compliance, with the remainder causing widespread air pollution. By its own count, Eskom exceeded its agreed limits more than 2000 times during the year 2021. 

Eskom lost a landmark 2022 court case, in which courts found that rampant air pollution is a violation of citizens’ constitutional rights. Yet Eskom continues to fight for - and receive - exemptions which allow the company to keep polluting. 

A 2017 summary report (based on M. Holland's 2017 report Health impacts of coal fired power plants in South Africa) lists the health impacts of Eskom's coal power plants. Each year they are responsible for causing at least 2,239 premature deaths, 2,781 cases of chronic bronchitis in adults, 9,533 cases of children bronchitis and several other negative health impacts. The total cost associated with these impacts exceeds USD 2.3 billion. Some researchers argue that air pollution from Eskom may be responsible for a far greater number of premature deaths, stretching into the tens of thousands.  

Energy Crisis

Prices for electricity in South Africa have more than doubled over the last decade. At the same time, an energy crisis has taken control of the country. South Africa’s power plants cannot meet energy demand, forcing the government to institute rolling blackouts, called “loadshedding.” In 2022, these blackouts stretched across 3,775 hours over 205 days and cost the country’s economy up to R1 billion a day, according to the Energy Minister. The areas that experience the most intense blackouts are often in working-class, poor, and black communities. 

For sick South Africans, power cuts can be the difference between life and death. Although hospitals usually have independent generators, these tools often aren’t built to withstand frequent blackouts, causing stress for patients and medical workers alike. Load shedding at water treatment plants may also worsen rates of illness.


Impact on climate

South Africa is currently ranked eighth in the world in terms of the total amount of coal used for electricity generation. 85 percent of the country’s electricity is produced in coal-fired power plants. Eskom is responsible for more than 200 million tons of CO2 equivalent each year, according to its 2022 integrated report. Because of this setup, South Africa’s electricity generation is one of the world’s most carbon-intensive energy systems. 

Eskom’s greenhouse gas emissions have only dropped slightly over the last decade. Some evidence suggests the company pushed back against investing in renewable energy sources in the mid-2000s as the South African government began encouraging growth in the sector. Eskom’s dominance in sponsoring academic research also caused the bulk of research funding to go towards non-renewable energy sources. 

Eskom received USD$8.5 million in 2021 to finance a just energy transition towards renewables. However, Eskom aims to direct almost half of that funding towards non-renewable energy sources, like methane gas-fired power plants. Moreover, former CEO Andre de Ritter claimed the South African government tried to “water down” safeguards against corruption, allowing the money to be claimed by private interests instead of investing it in renewables. 

Although Eskom’s 2022 integrated report calls for the “repowering” of old coal-fired power facilities, the company has only retired one of its four earmarked stations. The rest will remain in operation at least until 2025.


Impact on nature and environment

Water scarcity

Eskom has rights to 360.3 million cubic metres of water each year. The company pays less for water per cubic metre than the average household and has been ramping up its consumption over the last several decades. Yet South Africa has one of the lowest levels of water availability in the world. 

A 2015 study found that three of Eskom’s older, recommissioned plants consume up to four billion litres of water each year. Eskom intended to close the plants upon completion of the Medupi and Kusile power stations, yet the company has repeatedly pushed back closure dates and continues to guzzle surplus water. In Limpopo province, where the Medupi station operates, Eskom’s operations have reduced the flow of the Mokolo river. 

Eskom claims it will need more water in the future, as it adapts plants to meet lower emissions requirements. 

Pollution

Coal ash produced at Eskom’s power plants contributes to pollution through fugitive dust and water infiltration. This ash contains many contaminants, including mercury, which transforms into an even more toxic variant called methyl mercury in aquatic environments. Methyl mercury persists in fish and passes from parents to their offspring. 

Moreover, the coal mines that feed Eskom’s facilities release sulphide minerals, which add dissolved salts to aquatic environments and change the water’s PH balance. Waterways near coal mines, including the Olifants, Klip, and Wilge Rivers, show evidence of harmful mine drainage, as algae species that thrive in the effluent water have begun to dominate the aquatic systems.


Other impacts

Odious debt 

A growing movement accuses Eskom of taking on “odious debts.” The term refers to debts that arise from actions that are not in the public interest of the borrower state. For debt to be odious, the lender and borrower already know - or at the very least, should know - of the issue at the time of lending. 

In Eskom’s case, the Medupi power plant offers a valuable example. In 2010, the bulk of a USD $3.75 billion World Bank loan to Eskom was directed towards the plant, despite the widely known negative climate and environmental impacts of coal. Against widespread protests, World Bank management decided the plant “support[ed] interventions to mitigate climate change,” - although the plant had high projected carbon emissions. Eskom continues to pay the Bank penalty fees on unpaid debts, hampering the energy company’s ability to move on towards cleaner power sources. 

Likely conflict of interest behind coal contracts and projects in South Africa

The 355-page State of Capture report from South Africa’s Public Protector reveals details of favourable decisions by state utility Eskom to award huge coal supply contracts to Tegeta Exploration and Resources, a company co-owned by the son, Duduzane, of (former) South African President Jacob Zuma, and the Gupta family, close friends of Jacob Zuma. The revelations add new fuel to longstanding suspicion about the role of government leaders and relatives of former President Zuma with ties to the coal industry in paving the way for new coal mining and new coal-fired power plants in the face of serious water use, pollution and economic concerns. According to a Circle of Blue investigative report, “the ANC operates an investment arm, called Chancellor House, that owned an investment stake in Hitachi, which won the multi-billion dollar contracts to build the boilers for the two giant and unfinished Medupi and Kusile coal-fired power plants. Chancellor House also held a financial stake in the proposed 1,050-megawatt coal-fired Colenso power plant.

Incidents at Koeberg

Eskom's nuclear plant Koeberg has seen its share of incidents. In December 2005, a foreign object caused damage to one of the reactors' generators. It had been left inside by poorly trained and inadequately supervised workers. A similar incident happened in February 2006 when one of the reactors was forced to shut down causing blackouts on the Western Cape. The then Minister of Trade and Industry blamed an organisation called the Imam Haroon Brigade. The Brigade claimed responsibility for the sabotage. Both the minister and the Brigade were guilty of storytelling: there was no sabotage and the shutdown had been caused by human error.

Financiers

JPMorgan Chase financed Eskom in 2018-2022 totalling USD 980.45 million.

In Februari 2018, Eskom signed a ZAR 20 billion (EUR 1.206 billion) credit facility involving seven banks (Eskom press release).

Between 2014 and 2017, 13 financial institutions have provided a total of USD 1.383 billion in loans and USD 1.251 billion in underwriting services to Eskom. The FIs involved are listed below.

 

Institution type
Finance type
Year
Projects
There are no active project profiles for Eskom now.

Grand Inga dam

Congo, the Democratic Republic of the
Project
On record
Hydroelectric Power Generation

Grand Inga dam

Congo, the Democratic Republic of the

Kusile coal power plant

South Africa
Project
On record
Coal Electric Power Generation

Kusile coal power plant

South Africa

Medupi coal power plant

South Africa
Project
On record
Coal Electric Power Generation

Medupi coal power plant

South Africa
Governance
Norms & standards

Applicable norms and standards

United Nations Global Compact
News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

In South Africa, resistance rises to the World Bank’s climate-killing mega-projects

2022-10-16 | Committee for the abolition of illegitimate debt
Blog
BankTrack news BankTrack blog Partner news Partner blog

Who is still financing the global coal industry?

New research reveals banks and investors behind the world’s worst climate offenders
2022-02-15 | Berlin | Urgewald
BankTrack news BankTrack blog Partner news Partner blog

Eskom was just denied a licence to pollute. Now it is worried about keeping the lights on

Eskom was recently named the worst sulphur dioxide polluter in the world – and it is barely even trying, according to a rejection letter
2021-12-14 | Business Insider South Africa
BankTrack news BankTrack blog Partner news Partner blog

Eskom named planet’s largest emitter

A new study released by the Center for Research on Energy and Clean Air (CREA) has named Eskom the world’s most polluting company, having overtaken the US, EU and China.
2021-10-07 | ESI Africa
BankTrack news BankTrack blog Partner news Partner blog

Some SA banks committed to fossil fuel disinvestment — others aim to keep coal and oil financing furnaces burning

2021-10-04 | Daily Maverick
BankTrack news BankTrack blog Partner news Partner blog

Eskom wants permission to keep on polluting

2018-03-19 | The Sunday Times
BankTrack news BankTrack blog Partner news Partner blog

Eskom’s other disaster: How 50 years of bad decisions led to the Mpumalanga Highveld’s bad air

2018-02-06 | The Daily Maverick
BankTrack news BankTrack blog Partner news Partner blog

Eskom: Kusile and Medupi projects should be put on ice

2017-11-19 | PoliticsWeb
BankTrack news BankTrack blog Partner news Partner blog

Air pollution from coal power stations causes disease and kills thousands of South Africans every year, says UK expert

2017-09-12 | Centre for Environmental rights
BankTrack news BankTrack blog Partner news Partner blog

Request for Eskom tariff increase of more than 25%

2015-03-20 | Business Day Live
BankTrack news BankTrack blog Partner news Partner blog

Public Panel Event- Waterberg Electricity

2014-05-26 | Earth Life
BankTrack news BankTrack blog Partner news Partner blog

Who's the boss? How Eskom plans to dupe South Africa

2014-02-12 | Earth Life
BankTrack news BankTrack blog Partner news Partner blog

‘Desperate’ Eskom burn-tests coal sample

2014-02-10 | Business Day Live
BankTrack news BankTrack blog Partner news Partner blog

Eskom CEO Quits as South African Utility Faces Blackout Threats

2013-12-05 | Bloomberg
BankTrack news BankTrack blog Partner news Partner blog

New Eskom power plant defies carbon cut pledge

2013-09-27 | Mail & Guardian
BankTrack news BankTrack blog Partner news Partner blog

Eskom faces coal conundrum

2013-09-20 | Business Day Live
BankTrack news BankTrack blog Partner news Partner blog

Medupi farce may cost trillion-plus

2013-07-10 | Business Day
BankTrack news BankTrack blog Partner news Partner blog

Eskom’s new power delayed to 2014

2013-07-08 | Business Report
BankTrack news BankTrack blog Partner news Partner blog

Medupi, Kusile contractors and unions reach agreement

2013-06-12 | MoneyWeb
BankTrack news BankTrack blog Partner news Partner blog

Medupi deadline will not change: Gigaba

2013-03-15 | The New Age
BankTrack news BankTrack blog Partner news Partner blog

Eskom: A company in distress

2013-03-04 | Daily Maverick
BankTrack news BankTrack blog Partner news Partner blog

High energy users deny subsidies

2013-01-21 | Business Day Live
BankTrack news BankTrack blog Partner news Partner blog

Nersa’s public hearings continue

2013-01-21 | Business Report
BankTrack news BankTrack blog Partner news Partner blog

Eskom uses spy agency to counter labour unrest

2013-01-20 | Business Day Live
BankTrack news BankTrack blog Partner news Partner blog

Medupi operations remain suspended

2013-01-17 | IOl news
BankTrack news BankTrack blog Partner news Partner blog

Medupi workers march to Eskom

2012-10-19 | Business Report
BankTrack news BankTrack blog Partner news Partner blog

Investing in water-less green solutions imperative

2012-10-17 | Business Day Live
BankTrack news BankTrack blog Partner news Partner blog

Barclays, HSBC and RBS linked to 'dirty financing' for fossil fuels

2011-06-14 | The Ecologist
BankTrack news BankTrack blog Partner news Partner blog

Eskom resumes Medupi construction after protests

2011-05-23 | South Africa | Reuters
BankTrack news BankTrack blog Partner news Partner blog

Down Eskom’s garden path

2011-05-18 | news24
BankTrack news BankTrack blog Partner news Partner blog

US bank set to approve Eskom loan for Kusile

2011-04-18 | BusinessDay
Blog
BankTrack news BankTrack blog Partner news Partner blog

U.S. Taxpayer-Funded Bank Should Follow the Doctor's Orders on Coal in South Africa

2011-03-18 | United States | Michelle Chan, Economic policy director, Friends of the Earth US
Blog
BankTrack news BankTrack blog Partner news Partner blog

Medupi (Afrique du Sud) : le Crédit Agricole finance un projet charbonnier climaticide

2010-10-14 | Paris | Les Amis de la Terre
Blog
BankTrack news BankTrack blog Partner news Partner blog

Medupi (South Africa): Crédit Agricole finances a climate destructive coal project

2010-10-14 | Paris | Les Amis de la Terre
Resources
Documents
Videos
Links
2023-09-01 00:00:00

Living in Medupi's shadow

Stories from Lephalale
NGO document
2023-09-01 00:00:00 | Fair Finance Southern Africa
2021-10-31 00:00:00

Eskom is now the world’s most polluting power company

NGO document
2021-10-31 00:00:00 | Centre for Research on Energy and Clean Air
2018-03-31 00:00:00

Annual integrated report 2018

Annual report
2018-03-31 00:00:00 | Eskom
2017-10-31 00:00:00

Broken promises

The Failure of the Highveld Priority Area
NGO document
2017-10-31 00:00:00 | Centre for Environmental Rights, groundWork
2017-03-31 00:00:00

Health impacts of coal fired power plants in South Africa

Other document
2017-03-31 00:00:00 | M. Holland PhD (Ecometrics Research and Consulting)
2018-01-31 00:00:00

Air pollution from Eskom coal power plants

NGO document
2018-01-31 00:00:00 | Centre for Environmental Rights, groundWork
2017-03-31 00:00:00

Annual integrated report 2017

Annual report
2017-03-31 00:00:00 | Eskom
2015-05-04 00:00:00

The end of coal?

2015 Coal Finance Report Card
BankTrack publication
2015-05-04 00:00:00 | BankTrack, Rainforest Action Network, Sierra Club
2014-01-01 00:00:00

September 2013 Integrated interim report

Annual report
2014-01-01 00:00:00 | Eskom
2013-09-23 00:00:00

Coal Market Update September 2013

Governments and international financial institutions waking up to the dangers of coal investments
BankTrack publication
2013-09-23 00:00:00 | Greenpeace, BankTrack
2013-07-23 00:00:00

Coal Market Update July 2013

Low prices take their toll on coal firms
BankTrack publication
2013-07-23 00:00:00 | Greenpeace, BankTrack
2011-09-29 00:00:00

The external cost of coal-fired power generation

The case of Kusile
NGO document
2011-09-29 00:00:00 | Greenpeace
2011-03-11 00:00:00

Fossilized Thinking: The World Bank, Eskom, and the real cost of coal

NGO document
2011-03-11 00:00:00 | COEIL
2011-01-15 00:00:00

Kusile Power Project Factsheet

NGO document
2011-01-15 00:00:00 | Sierra Club
2010-04-03 00:00:00

Statement from South Africa and Africa civil society on Eskom's proposed USD3.75 billion World Bank loan

NGO document
2010-04-03 00:00:00 | Civil Society Organisations
2010-03-11 00:00:00

UK NGOs letter to UK government on World Bank vote on Medupi

NGO document
2010-03-11 00:00:00 | UK NGOs
2010-03-01 00:00:00

Eskom World Bank loan factsheet

NGO document
2010-03-01 00:00:00 | NGOs
2009-12-01 00:00:00

The World Bank and Eskom : Banking on Climate Destruction

NGO document
2009-12-01 00:00:00 | groundWork (FoE South Africa)
2009-03-01 00:00:00

GroundWork warning letter to the World Bank on Medupi

NGO document
2009-03-01 00:00:00 | groundWork and many other NGOs
2007-02-01 00:00:00

Kusile Environmental Impact Assessment

Company document
2007-02-01 00:00:00 | Eskom

The cost of Medupi

Video by Oxfam South Africa

2023-09-06 13:53:12

Map of environmental conflicts linked to Eskom, by Environmental Justice

FoE US - A day’s journey through South African coal country

Blog post about a visit to see the construction area of the Kusile power plant.

Eskom's webpage on corporate social responsibility

Business & Human Rights Resource Centre dossier on Eskom

Life After Coal/Impilo Ngaphandle Kwamalahle

Campaign website by Earthlife Africa Johannesburg, groundWork, and the Centre for Environmental Rights

Send feedback on this profile
Sections
Banks Dodgy Deals Campaigns
Our campaigns
Banks and Climate Banks and Human Rights Banks and Nature
Our projects
Tracking the NZBA Banks and Russia Banks and Steel Tracking the Equator Principles Tracking the PRBs Find a Better Bank Banks and the OECD Guidelines
Media
News Publications
Raiffeisen Out! Bank.Green End Coal Finance Plastic Banks Tracker Defund TotalEnergies Financial Exclusions Tracker Equator-Complaints.Org Don't Buy into Occupation Banks & Biodiversity Forests & Finance Drop JBS StopEACOP Fossil-Free Finance
BankTrack
About BankTrack Organisation Our team Our board Our annual reports Funding and finances Guiding principles Our history BankTrack in the media Team up with us Our privacy policy Donate Visit us
Successes Contact BankTrack
Vismarkt 15
6511 VJ Nijmegen
The Netherlands
Contact@banktrack.org
Donate Mailing list Facebook Twitter Linkedin
©2023 BankTrack
BankTrack is a registered charity in the Netherlands (ANBI) - RSIN 813874658
Find our privacy policy here

Stay up to date

Sign up now for all BankTrack's news


Make a comment

Your comment will be reviewed, before being posted