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2 - Why the Lights Went Out: A Capability Perspective on the Unintended Consequences of Sector Reform Processes

from Part I - Mitigating Institutional Voids by Design

Published online by Cambridge University Press:  14 November 2019

By
Hagen Worch ,
Mundia Kabinga ,
Anton Eberhard ,
Jochen Markard  and
Bernhard Truffer
Edited by
Nuno Gil ,
Anne Stafford  and
Innocent Musonda
Nuno Gil
Affiliation:
University of Manchester
Anne Stafford
Affiliation:
University of Manchester
Innocent Musonda
Affiliation:
University of Johannesburg
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Summary

In this chapter we advance the argument that regulatory policies can have a far-reaching impact on the organizational capabilities and, ultimately, on the performance of public utilities. Once capabilities are lost, it may be hard to regain them in the short term. Our insights are based on a qualitative-comparative analysis of capability-losing processes at Eskom, South Africa’s national electric utility. South Africa experienced severe power outages between 2005 and 2008, which are commonly explained as having been caused by inadequate generation capacity, badly maintained power plants and insufficient coal supply. In this chapter, we go a step further and examine the underlying reasons at the organizational level. We show that a variety of new regulations led to a substantial loss of critical competences and skills at Eskom. This caused a deterioration of planning, operation and maintenance procedures, and made swift reactions to the crisis difficult. The ‘capability perspective’ presented in this chapter complements traditional theoretical explanations of utility and sector performance.

Type
Chapter
Information
Duality by Design
The Global Race to Build Africa's Infrastructure
 , pp. 33 - 68
Publisher: Cambridge University Press
Print publication year: 2019

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