/ 23 November 2016

Scandal dogs Koko, the Eskom man rumoured to step into Molefe’s shoes

According to Mabuza
Matshela Koko, the former head of generation at Eskom. (Madelene Cronje/M&G)


If Brian Molefe’s stepping down as the head of Eskom is in the name of good governance, then the utility’s head of generation, Matshela Koko, shouldn’t be selected to step up.

After Molefe’s tearful resignation, Koko is said to be firmly in the running to be selected as the new chief executive, according to several insiders at Eskom.

The utility says it cannot comment on speculation, but industry experts say that, usually in an energy utility, the head of generation is the natural successor for the position of chief executive.

The circumstances are, however, anything but normal.

The public protector’s State of Capture report compiled a compelling amount of evidence (termed “observations” by Molefe) that suggests the Eskom board and the utility’s executives broke the law several times in connection with coal deals that appeared to favour the politically connected Gupta family.

For Molefe, the 44 calls to Ajay Gupta and cellphone data suggesting several visits to the Gupta estate in Saxonwold compromised him personally.

Koko, as the head of generation, holds executive responsibility for coal procurement. His signature on a document approving a prepayment of R600 000 to Gupta-owned Tegeta, which enabled it to buy Optimum Coal, clearly implicates him in the matter.

Unlike Molefe, Koko was not subpoenaed to give evidence to the public protector.

In June this year, before the State of Capture investigation, Carte Blanche interviewed Koko and asked him about the prepayment. At first he denied it but, when presented with his signature on the document, he quickly back-pedalled, claiming he had made a mistake.

A judicial commission of inquiry, which the public protector’s report requires to be set up, would air a great deal of dirty laundry. Although Eskom and others have expressed an intention to take the report on review, should the inquiry go ahead, Molefe’s role will be a focal point, but Koko’s will also be investigated.

He faces further public scrutiny: the Constitutional Court is preparing to deliver judgment relating to a R5-billion contract for steam generators at the Koeberg nuclear power plant, which was awarded to Areva after the intervention of Koko, despite consistent recommendations by Eskom’s technical and executive teams that it should go to Westinghouse.

The matter was taken on appeal by Eskom but, if the judgment doesn’t go its way, it implicates Koko in tender fraud.

He was also suspended pending an internal investigation but was reinstated without the findings ever being disclosed.

Pro-nuclear Koko’s assumptions and expertise have been called into question following his comments asserting that Eskom could pay for the nuclear build programme from its own cash reserves, which he said would amount to R150-billion in 10 years’ time.

Doug Kuni, an independent power consultant with a 30-year career in the electrical power sector, said the delays in the coal mega-builds, Medupi and Kusile, demonstrated a lack of capacity at Eskom.

To punt nuclear, he said, was illogical because it required even more skill and capacity than a coal-fired power station build. Neither Koko nor any member of the Eskom board and executive committee had any experience in building power stations. “Eskom is a huge, complex machine. If you don’t understand the most complex part of that machinery [generation], how can you lead the whole utility?” Kuni asked.

The department of public enterprises referred the Mail & Guardian’s questions about Koko as Molefe’s successor to Eskom.

Eskom said it would announce an interim or permanent replacement for Molefe in due course.

It is up to the Eskom board to select Molefe’s replacement, which the public enterprises minister (the shareholder representative) then takes to the Cabinet for approval.

Industry experts said the public can take comfort in that, whoever is Molefe’s successor, Eskom is not a one-man show.