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INTEGRATED RESULTS PRESENTATION
KING III APPLICATION
 
   



Appendix A: Key performance indicators

The following table shows the key performance indicators of Eskom, and includes all the shareholder’s compact indicators.

The key performance indicators are colour coded to indicate the link to the executive compact key performance areas. Refer to executive remuneration on page 80.

 
Executive compact key performance areas
     
  1.   Operate safely     Five-year trend from 2009/10 to 2013/14
  2.   Keep the lights on    
The key performance indicator shows a positive trend over the five years, with the arrow indicating the performance against target
The key performance indicator shows a negative trend over the five years, with the arrow indicating the performance against target
The key performance indicator has been stable over the five years
  3.   Deliver on the capacity expansion programme    
  4.   Protect the environment    
  5.   Socio-economic contribution and build skills    
  6.   Transformation    
  7.   Improve performance    
  8.   Chief executive discretion    

 
Indicator and unit
Target
2017/18
 
Target
2013/14
  Actual
2013/14
 
Actual
2012/13
 
Actual
2011/12
 
Actual
2010/11
 
Actual
2009/10
 
Five-year
trend
Becoming a high-performance organisation
             
Focus on safety
             
  Employee lost-time incidence rate (LTIR) , indexSC 0.24   0.36   0.31RA   0.40RA1   0.41RA   0.47RA   0.54RA  
Fatalities (employees and contractors), number 0   0   23RA   19RA   24RA   25RA   17RA  
Improve operations
             
  Normal unplanned capability loss factor, %SC,2 10.00   10.00   12.61RA   12.12RA   7.97RA   6.14RA   5.10RA  
Less: Constrained unplanned capability loss factor, %3     1.63   3.41          
Underlying unplanned capability loss factor, %4     10.98   8.71            
Normal planned capability loss factor, %5 10.00   10.00   10.50RA   9.10   9.07   7.98   9.04  
Underlying planned capability loss factor, %6     10.77            
Energy availability factor (EAF), %SC 80.00   80.00   75.13RA   77.65RA   81.99RA   84.59RA   85.21  
  Total system minutes lost for events <1 minutes, minutesSC 3.80   3.40   3.05RA   3.52RA   4.73RA   2.63RA   4.09RA  
Major incidents, number 1   2   0RA   3RA   1RA   0RA   1RA  
System average interruption frequency index, events7 17.0   20.0   20.2RA   22.2RA   23.7RA   25.3RA   24.7RA  
System average interruption duration index, hoursSC,8 39.0   45.0   37.0RA   41.9RA   45.8RA   52.6RA   54.4RA  
Being customer-centric
             
  Customer service indexSC 89.7   88.7   86.6   86.8   85.6   84.4   85.1  
Eskom KeyCare, index 102.0   102.0   108.7   105.8   105.9   101.2   98.1  
Arrear debts as % of revenue (group), %   0.50   1.10   0.82   0.53   0.75   0.83  
Customer service (large power users – <100GWh per annum), average debtors’ days   16.0   16.9   18.3        
Customer service (large power users – municipalities), average debtors’ days   22.0   32.7   22.4        
Customer service (large power users – including municipalities), average debtors’ days       18.3   21.8   18.9   18.9    
Customer service (small power users excluding Soweto debt), average debtors’ days   42.0   50.2   48.2   42.9   45.1   40.5  
Customer service large power top customers excluding disputes, average debtors’ days   14.0   14.5   12.3   14.4   15.5   15.4  
Build strong skills
             
  Training spend as % of gross employee benefit costs,%SC,9 5.00   5.00   7.87RA            
Total engineering learners in the system, numberSC 391   2 007   1 962RA   2 144RA   2 273RA   1 335   955  
Total technician learners in the system, numberSC 652   780   815RA   835RA   844RA   692   681  
Total artisan learners in the systemSC, number 1 434   2 619   2 383RA   2 847RA   2 598RA   2 213   2 144  
Strategic Youth Development Programme, numberSC,10   5 000   4 325RA   5 701RA   5 159      
Leading and partnering to keep the lights on
         
Keep the lights on
         
  Maintenance backlog reduction based on the Eskom Technical Governance Committee approval, numberSC,1 0   0   0RA            
  Integrated demand management savings, MWSC,12 174.0   379.0   409.6RA   595.0RA   365.0RA      
  Internal energy efficiency, GWhSC,13 0.0   15.0   19.4RA   28.9RA   45.0RA   26.2RA    
Deliver capital expansion
               
  Generation capacity installed and commissioned, MWSC 6 214   100   120RA   261RA   535RA   315RA   452RA  
Transmission lines installed, kmSC 1539.0   770.0   810.9RA   787.1RA   631.0RA   443.0RA   600.0RA  
Transmission capacity installed and commissioned, MVASC 5 755   3 790   3 790RA   3 580RA   2 525RA   5 940RA   1 630RA  
Generation new build capacity milestones (Medupi, Kusile and Ingula),daysSC 30.00   30.00   48.90RA   43.48        
Total capital expenditure (excluding capitalised borrowing costs),
R billion
40.8   62.3   59.8RA   60.1   58.8   47.9   48.7  

Reducing Eskom’s environmental footprint and pursuing low-carbon growth

       
Reduce environmental footprint in existing fleet
           
  Relative particulate emissions, kg/MWhSC 0.29   0.36   0.35RA   0.35RA   0.31RA   0.33RA   0.39RA  
Specific water consumption, L/kWh sent outSC,14 1.21   1.39   1.35RA   1.42RA   1.34RA   1.35RA   1.34RA  
Environmental legal contraventions in terms of the operational health dashboard, number15 0   0   2   2   5      
Transformation (including the business productivity programme)
         
Maximise socio-economic contribution
             
  Corporate social investment, R million   133.0   132.9RA   194.3RA   87.9RA   62.3RA   58.7RA  
Job creation, number 2 000   24 965   25 181RA   35 759   28 616   21 477    
Total number of electrification connections, number16 300 013   184 975   201 788RA   139 881   154 250   145 360   145 284  
Employment equity – Company
         
  Employment equity – disability, %SC 3.00   3.00   2.99RA   2.59RA   2.49RA   2.53   2.54  
Racial equity in senior
management, % black
employeesSC
74.0   61.0   59.5RA   58.3RA   53.9RA   52.5   47.3  
Racial equity in professionals and middle management, %
black employeesSC
79.0   71.0   71.2RA   69.6   65.7   64.1   62.9  
Gender equity in senior
management, % female
employeesSC
38.0   30.0   28.9RA   28.2RA   24.3RA   23.5   21.6  
Gender equity – professionals and middle management, %
female employeesSC
42.0   36.0   35.8RA   34.6   32.4   31.6   30.3  
Employment equity – Group
         
  Employment equity –
disability, %
2.5   3.0   2.8RA   2.4RA   2.4RA   2.4   2.3  
Racial equity in senior
management, % black
employees
  61.0   59.3RA   58.4        
Racial equity in professionals and middle management, %
black employees
  61.0   70.6RA   69.0        
Gender equity in senior
management, % female
employees
  30.0   28.8RA   28.5        
Gender equity in professionals and middle management, %
female employees
  36.0   34.9RA   34.0        
Procurement equity – Company
             
  Local sourcing in procurement
(new build), %SC,17
52.0   52.0   54.6RA   80.2RA   77.2RA   79.7v   73.9RA  
Procurement from B-BBEE compliant suppliers, % 75.0   75.0   93.9RA   86.3RA   73.2RA   52.3RA   28.6  
Procurement from black- owned suppliers, % 20.0   10.0   32.7RA   22.1   14.6      
Procurement from black women- owned suppliers, % 9.0   5.0   7.5RA   4.7RA   3.3RA   4.3   12.1  
Procurement from black youth- owned suppliers, % 5.0   1.0   1.0RA          
Procurement equity – Group
             
  Procurement from B-BBEE compliant suppliers, % 75.0   75.0   91.8RA   82.1RA        
Procurement from blackowned suppliers, % 20.0   10.0   35.3RA            
Procurement from black women-owned
suppliers, %
9.0   5.0   7.5RA   5.1RA        
Procurement from black youth-owned
suppliers, %
5.0   1.0   1.0RA            
Implementing coal haulage and the road-to-rail migration plan
         
Implement coal road to rail migration plan
         
  Coal road-to-rail migration (additional tonnage transported on rail), MtSC 20.7   11.5   11.6RA   10.1RA   8.5   7.1   5.1  
Pursuing private sector participation
           
  Pursuing private sector participation IPP purchases, GWh   4 152   3 671   3 516   4 107   1 833  
Ensuring Eskom’s financial sustainability
     
Ensure financial sustainability (shareholder compact ratios) – Company18
         
  Cost of electricity (excluding depreciation), R/MWhSC 732.10   453.40   541.92RA   496.24RA   374.19RA   296.36RA   255.09RA  
Interest cover, ratioSC 1.06   1.18   0.65RA   0.27RA   3.27RA   1.40RA   0.77RA  
Debt:equity (including long-term provisions), ratioSC,19 3.40   2.17   2.21RA   1.96RA   1.69RA   1.66RA   1.68RA  
FFO as % of total debt, %SC 11.08   9.11   9.21RA   8.55   15.06   12.55   7.12  
Ensure financial sustainability – Company
         
  Electricity revenue per kWh (including environmental levy), c/kWh 89.30   62.37   62.82   58.49   50.27   40.27   31.95  
Electricity operating cost per kWh (including depreciation and amortisation), c/kWh 73.21   52.67   59.67   54.15   41.28   32.78   28.23  
Ensure financial sustainability – Group
         
  Working capital ratio, ratio 0.79   0.65   0.71   0.68   0.76   0.85   0.89  
Free funds from operations (FFO), R million19 49 119   29 653   27 542   18 108   30 483   16 953   2 356  
Gross debt/EBITDA, ratio19 6.80   7.95   10.96   16.20   6.46   7.55   8.40  
Debt service cover ratio, ratio 2.17   1.55   1.21   2.01   3.50   1.90   1.43  

Notes:
RA Reasonable assurance provided by the independent assurance provider (refer pages 180 to 184).
SC Included in the Shareholder Compact.

1. Two late LTIR incidents resulted in the signed-off LTIR for 2012/13 changing from 0.39 to 0.40.
2. Normal UCLF – measures the lost energy due to unplanned energy losses resulting from equipment failures and other plant conditions.
3. Constrained UCLF – This is UCLF that was a result of emissions and short-term related UCLF due to system constraints to meet the “Keeping the lights on” objective. This is apportioned between PCLF and OCLF.
4. Underlying UCLF – This is the UCLF that is now the difference between normal and constrained UCLF and that is still within Generation control.
5. Normal PCLF – is energy loss during the period because of planned shutdowns.
6. Underlying PCLF – The sum of the normal PCLF and the constrained PCLF (the apportionment of the constrained UCLF that is assigned to PCLF).
7. SAIFI is a reliability of supply index – how often on average (frequency) the customer connected would experience a sustained interruption per annum (number of times per annum).
8. SAIDI is an availability of supply index – the average duration (hours) of a sustained interruption the customer would experience per annum (number of hours per annum).
9. Training spend as a % of gross employee benefit costs is a new measure, effective from 1 April 2013.
10. Includes learners trained by Eskom, as well as learners trained by Eskom’s suppliers.
11. Refer to pages 114 to 115 for the maintenance backlog reduction strategy, where the extent of the maintenance backlog is explained.
12. The basis of measurement changed during the 2010/11 year; prior to that verified savings of 372MWRA (2009/10) were achieved.
13. Reporting basis changed during the 2010/11 year; hence no comparatives are available prior to 2010/11.
14. The volume of water consumed per unit of generated power from commissioned power stations.
15. From 2012/13, environmental legal contraventions has been tracked in terms of the operational health dashboard. In defined circumstances where the management of a legal contravention indicates specific management issues/failings, it is recorded on the Eskom operational health dashboard. Comparatives for this measure have been provided.
16. The reporting boundary for the number of connections was changed in March 2014 to exclude farm workers and municipality funded connections. The target has been revised to exclude 551 farmer connections. The comparatives have been restated (876 and 963 farmer connections, and 3 801 and zero municipality deducted for March 2013 and March 2012 respectively). A total of 992 farm worker, and 2 879 municipality funded connections were installed for the current year.
17. Local sourcing of procurement for capital expansion projects only.
18. The original year to 31 March 2014 budget which was included for the shareholder compact was subsequently revised and the differences mainly result from additional operating expenditure allocated to Generation. The revised budget ratios are as follows:
(i) Cost of electricity (excluding depreciation) 463.25 R/MWh
(ii) Interest cover (excluding remeasurement of the shareholder loan) 0.98
(iii) Debt/equity ratio 2.19
(iv) FFO as a % of gross debt 10.51%
19. Comparative restated