State-owned power utility Eskom says an interim report by an independent forensic firm has identified instances of non-adherence to Eskom processes in the procurement of services, and the management of the contracts, for diesel supply.

The contracts under investigation by Eskom Group Investigations and Security relate to the supply of diesel to its open-cycle gas turbine power stations, which support system reliability during emergencies, particularly at peak demand and during periods of high breakdowns.

Owing to the findings of the interim report, Eskom will start disciplinary proceedings against several employees who breached its procurement processes. The utility expects more employees may be charged once the final report has been issued, it says.

Additionally, in line with its supplier-review process, disciplinary action will be undertaken against suppliers found to have breached its procurement policy and processes.

As a result of the suspicion of fraud and corruption, Eskom has reported this matter to the Directorate for Priority Crime Investigation, in line with the requirements of the Prevention and Combating of Corrupt Activities Act, it adds.

The final report is expected to be completed in mid-June.

Eskom recognises the intense public interest in this matter, it says; however, given the consequence-management steps Eskom is taking to address identified irregularities, the interim nature of the report and the possibility of criminal prosecution, it will not engage on the details or comment further at this stage, so as not to jeopardise the next stage of the process.

Updates will be communicated at an appropriate time, in line with legal, governance and regulatory requirements, the utility says.

“We maintain zero tolerance for corruption and any breach of Eskom’s processes. This investigation was initiated by Eskom management, which demonstrates our commitment to uncover and address wrongdoing without external prompting,” says Eskom chairperson Mteto Nyati.

“Consequence management [a South African term that means holding people accountable for their official actions or inaction] is immediate, uncompromising and non-negotiable. Those implicated, whether employees or suppliers, will be held accountable through disciplinary action and, where warranted, criminal processes.

“We will seek to recover every rand of financial loss and will execute our action plans to address historical misconduct, reinforce governance and embed ethical conduct at every level,” he says.

“The interim report pointed to a need to hold employees who did not follow Eskom’s processes accountable. This will be matched by action against specific suppliers, as required,” says Eskom Group CE Dan Marokane.

The ongoing resourcing drive to adequately capacitate Eskom's finance, internal audit and forensics functions to address key skills gaps is attracting talent, he adds.

“We are applying the same level of effort to ending years of governance and accountability failings as we did to ending loadshedding. We are doing this by continuously strengthening our controls as the landscape evolves,” Marokane states.

The investigation examined possible irregularities under tender MWP2197GX.

The investigation started in March 2025 after information was received through established reporting and whistleblowing mechanisms and after contract performance during the operational emergencies that involved loadshedding in early 2025 was reviewed.

“This reinforces the importance and effectiveness of these reporting and whistleblowing channels, and Eskom continues to treat all allegations of wrongdoing with the necessary seriousness and confidentiality,” the utility says.

In October 2022, the Eskom central panel used to perform proactive assurance and full probity reviews on procurement transactions exceeding R500-million was discontinued on the grounds that it was not cost-effective and had not identified significant findings in high-value tenders reviewed over a period of time.

Since then, only limited-scope reviews were undertaken by appointed audit firms, which left Eskom vulnerable to potential procurement irregularities. Limited-scope reviews typically only involve anti-bribery, fraud prevention and anti-money laundering checks, the utility says.

However, since late 2025, proactive assurance and full-scope probity reviews have been reinstated retrospectively on some transactions from 2025 and, going forward, on all high-value tenders.

This makes it procedurally difficult to recommend bidders who fail mandatory requirements, Eskom says.

Meanwhile, diesel use remains closely linked to prevailing system conditions and generation performance. In periods where the system is constrained or under emergency conditions, diesel‑fired generation is deployed to support supply and maintain grid stability.

In line with improving generation performance, diesel expenditure has declined materially. The reduction in diesel use reflects improved generation performance and reduced reliance on diesel‑fired generation as system stability continues to improve, Eskom says.

In its financial year to March 31, Eskom's diesel expenditure was R6.4-billion, which was below the R11-billion expenditure on diesel that had been budgeted for the year, and was 81% lower than the record R33-billion spent on diesel in the 2023 financial year.

Eskom also uses diesel-fired capacity from two independent power producer (IPP) stations, as part of its broader operations. These IPP arrangements are not part of the current investigation or associated consequence-management processes, it adds.