Eskom has suspended four of its executives.
Chairman of the power utility, Zola Tsotsi made the surprise announcement on Thursday at a press briefing.
“Four executives have been asked to step aside as an inquiry takes place, including the CEO,” said Tsotsi.
The CEO, Tshediso Matona was only appointed in August last year.
Zethembe Khoza, an Eskom non-executive board member, will assume the position of interim chief executive, said Tsotsi.
The power utilities’ financial director, Tsholofelo Molefe was also suspended together with the head of group capital Dan Marokane and head of commercial technology Matshela Koko.
“All these senior executives have been with the organisation a long time and we are confident that they will maintain business continuity during this period,” he added.
According to Tsotsi, the executives were asked to ‘step aside’ to allow for the process to continue. He said the decision was made in the best interest of its stakeholders. “There is no intent or suspicion of wrongdoing.”
The inquiry is expected to last no longer than three months.
Following the press conference a number of people CNBC Africa spoke to said they did not see this coming. “There must be something deeper behind the suspensions,” they reckoned.
Eskom said the inquiry would be conducted by an independent team which will be selected within the next week. “They will be given unfettered rights of access to all information deemed necessary for this probe to be successful,” the power giant said in a statement.
The independent inquiry will inspect the current status of the business and its challenges. These include: the poor performance of generation plant, delays in bringing the new generation plant on-stream, high costs of primary energy and cash-flow challenges.
“We hope to come out of this with a better grasp of all the challenges facing the business, and most importantly, with solutions,” said Tsotsi.
Eskom, which provides virtually all the electricity in Africa’s most developed economy, is facing a funding crunch as it races to bring new power plants online and is implementing power cuts to prevent the grid from being overwhelmed.
*Additional reporting by Reuters