South Africa’s electricity utility Eskom has delayed the publication of a new strategy blueprint to mid-November from an initial deadline of the end September to allow for greater consultation with external stakeholders.

Following the appointment of a new board in February, a strategy review was initiated in April and Boston Consulting Group was appointed to support Eskom with the development and delivery of the strategy.

However, chairperson Jabu Mabuza announced on Tuesday that it had since become apparent that the September deadline could not be achieved and that the board had, thus, shifted the deadline to November 15.

By that date, a final strategy blueprint – including portfolio recommendations, high-level Eskom operating model configuration and high-level financial plan – should be finalised.

The delay was attributed to several factors, including the delay in the appointment of Phakamani Hadebe as permanent CEO, protracted wage negotiations with unions, and the timing of the release of the draft Integrated Resource Plan (IRP 2018).

Government is aiming to finalise IRP 2018, which will define which generation technologies will be added to the country’s mix until 2030, before the end of the year. Energy Minister Jeff Radebe has allowed for a 60-day comment period, having released the document on August 27.

Eskom has already initiated a series of interactions with stakeholders as part of a review process, dubbed ‘Strategy 2035’.

However, following consultations with its shareholder, Mabuza reported that it had been decided that further engagements with key external stakeholders should be pursued to “ensure that an effective strategy is developed and executed”.

The “slight delay” would also allow for the blueprint to be stress-tested, as well as for “proper co-ordination between different key entities of the state”.

“To mitigate risks and further delays, we have established a board strategy committee that will meet frequently over the next few weeks to ensure continuous board oversight and timeous execution,” Mabuza added.

The new leadership at the State-owned company, together with Public Enterprises Minister Pravin Gordhan, have formally acknowledged that the group’s business model is no longer sustainable, in light of material technology changes in the electricity sector.

Several commentators have warned that the utility’s vertically integrated model is no longer “fit for purpose” and that the group’s weak financial position is unlikely to improve without the struggling generation business being separated from the transmission, system operations and distribution units.

There are also signs that Eskom has entered a so-called ‘utility death spiral’, whereby price elasticity of industrial demand, in particular, becomes a primary driver of falling demand.