Energy department admits 61% is a "gross underperformance" in its first year

The Department of Electricity and Energy delivered 61% of its annual performance targets in its first full year as a standalone department, its own minister told Parliament, calling the figure a gross underperformance.

Minister of Electricity and Energy Kgosientsho Ramokgopa told the Portfolio Committee on Electricity and Energy that the department should not be operating at that level and that the minimum should be 85%. He took full responsibility for the outcome.

The department’s accounting officer, acting director-general Mr Gagana, presented the 2025/26 annual report to the committee, covering the period from 1 April 2025 to 31 March 2026. It was the department’s first annual report since Proclamation 179 of 2024 split the electricity and energy functions out of the former Department of Mineral Resources and Energy, and moved oversight of Eskom to the new department.

The department had 38 annual targets, a final appropriation of R6.68 billion, and spent R6.4 billion, or 96% of its allocation. It recorded no unauthorised, fruitless and wasteful expenditure for the year. The Auditor-General issued an unqualified opinion with material findings on performance information and one compliance area.

Ramokgopa said a department of its budget size and staff complement should not be registering an unqualified audit and that a clean audit should be the norm rather than something to celebrate.

Programme 3, which carries the electrification mandate and at least 71% of the vote, achieved 45% of its targets. Programme 1, administration, achieved 40%. Programme 5, which oversees state-owned entities, achieved 100%.

The department missed 15 targets. These included the gas master plan, the integrated energy plan, the just energy transition framework and key new generation and infrastructure procurement instruments in the form of section 34 determinations. It also fell short on issuing the request for proposals for the transmission programme.

On delivery, the department reported connecting more than 100,000 households during the year through grid connections and non-grid solar home systems. It reported verified energy savings of 0.891 terawatt hours through 120 site inspections.

The Integrated Resource Plan 2025 was approved by Cabinet and gazetted on 28 October 2025. The department said this, together with the IRP, opens an estimated R2.2 trillion energy infrastructure investment programme.

The department also reported adding 680 megawatts of capacity through its independent power producer programme, and pre-qualifying seven bidders for 1,164 kilometres of new transmission line. It is working with National Treasury and the World Bank on a credit guarantee vehicle to unlock private capital for the grid.

On the constraints it faced, the department told the committee it began operating on a startup structure of 378 posts with 339 filled at year end. It had no permanent chief financial officer for most of the year and the director-general post has been filled in an acting capacity. The minister said the process to appoint a permanent director-general is at an advanced stage, with interviews and psychometric tests completed and the matter due to go to Cabinet.

A permanent CFO was appointed on 1 July 2026. The department also inherited R271 million in irregular expenditure and R50 million in unauthorised expenditure from the former departments.

Municipal debt to Eskom is sitting at about R15 billion and rising, the committee was told. The department also reported that grid connection constraints were delaying the commercial close of most independent power projects.

Eskom has achieved 500 consecutive days without load shedding, the committee heard, with the energy availability factor remaining critical to maintain at 60%.

On nuclear, the department achieved four of five targets in programme 4 and spent 99% of its allocated budget. It did not complete the socio-economic and cost benefit analysis for the procurement of up to 10 gigawatts of nuclear capacity because the concept note was finalised late. Terms of reference were issued in the fourth quarter and the appointment of a service provider is at an advanced stage.

Ramokgopa said the department is establishing a centre of excellence to aggregate the technical skills needed to drive energy policy, and that the institutionalisation of the Independent Power Producer office had been put on hold because its mandate has expanded from generation to include transmission. He said the question of whether generation and transmission should sit under one umbrella would be answered before institutionalisation proceeds.

He also said the department is accelerating recruitment at senior management level, subject to a process with the Department of Public Service and Administration that had delayed advertising of posts.

An opposition member told the committee that the minister’s early departure from the meeting would be a problem, saying the committee would be talking to itself. The minister apologised and explained that he had a long-scheduled mine visit in the Western Cape with four other ministers, and said he would stretch his presence at the meeting.

The department said it has established a weekly operational executive committee to address bottlenecks and review spending and delivery together, and that its new structure will be fully funded.

Source: Parliament of South Africa (YouTube), Portfolio Committee on Electricity and Energy, 1 October 2026: https://www.youtube.com/watch?v=uBCcqMbTxy0