Moody’s Investors Service has upgraded the long-term corporate family rating of Eskom to B2 from Caa1.
Moody’s also upgraded Eskom’s probability of default rating to B2-PD from Caa2-PD, its Baseline Credit Assessment to caa1 from caa3 and its national scale rating long-term corporate family rating to Baa3.za from B1.za.Moody’s also affirmed the Ba2 rating on Eskom’s backed senior unsecured notes that benefit from an unconditional and irrevocable guarantee from the Government of South Africa.
Treasury must advance R78 billion in the 2023–24 financial year, R66 billion in 2024–25 and R40 billion in 2025–26 to Eskom. Moody’s said the gas turbines have been running at over 20% of their capacity, significantly above the assumption of 6% used to set Eskom’s tariffs. Under the programme, Eskom would write off uncollected debts provided municipalities agree to mechanisms allowing their licences to be revoked for further non-payment.
Without these improvements or alternative mechanisms to ensure access to capital, Moody’s said Eskom’s rating will likely come under pressure as April 2026 approaches.