In an effort to navigate its ongoing challenges, South Africa’s struggling power utility Eskom is exploring the possibility of engaging in Bitcoin mining, artificial intelligence (AI), and establishing data centers as part of its long-term strategy. This insight comes from group CEO Dan Marokane.
During a recent address at the BizNews Conference, Marokane indicated that the utility is actively seeking innovative ways to utilize its surplus electricity capacity amid a changing energy landscape.
He highlighted an increasing demand from Bitcoin miners and data centers in the United States as a potential direction for Eskom’s future operations.
Eskom’s Strategic Overhaul Amidst a $22.7 Billion Debt Crisis
As Eskom grapples with a staggering R403 billion ($22.7 billion) debt, the utility is embarking on a significant strategic reevaluation in response to declining electricity sales.
CEO Dan Marokane has addressed the depth of the dilemma, labeling it a “structural decline” resulting from the rising trend of self-generation and independent power producers (IPPs).
This year alone, Eskom experienced a 4% drop in electricity sales, and projections suggest that this downward trajectory may persist for an additional three to five years.
“The business has to reinvent itself and utilize part of this baseload effectively to manage our debt,” Marokane stated, indicating a need for a transformation in Eskom’s commercial framework.
Reports are emerging of Eskom employees generating and selling fraudulent prepaid electricity tokens amounting to billions, which could be leading to increased tariffs and exacerbating past load-shedding issues. https://t.co/fhGlQQMoNu
— MyBroadband (@mybroadband) June 30, 2025
In addition to operational difficulties, Eskom faces a serious financial predicament, with municipal customers currently owing R90 billion. Furthermore, South Africa’s Electricity Minister, Kgosientsho Ramokgopa, has raised concerns that if unaddressed, Eskom’s total debt could escalate to R3.1 trillion by 2050.
To mitigate these financial woes, Eskom is looking into alternative applications for its unused generation capacity, including energy-intensive sectors such as AI data centers and potential Bitcoin mining operations.
“We must consider alternatives; there are exciting prospects in AI and data centers and even within Bitcoin mining,” Marokane remarked.
While Bitcoin mining remains a contentious subject, it offers a possible solution for idle electricity. In the United States, crypto miners and AI enterprises have evolved as significant consumers of energy.
According to the U.S. Energy Information Administration (EIA) in 2024, large-scale computing operations, particularly Bitcoin mining, are among the fastest-rising sources of electricity demand, particularly noted in Texas.
These facilities often negotiate agreements to lower their usage during peak demand times, mirroring Eskom’s own load curtailment strategy. An example includes Texas-based mining company Riot Platforms, which received $32 million in 2023 for reducing its electricity consumption during a heatwave.
Eskom is contemplating a similar approach, but as it envisions a future rich in energy-intensive operations, reports indicate that South Africa’s power grid is currently under severe strain.
From June 13 to June 19 this year, Eskom recorded average unplanned outages totaling 15,076 megawatts, surpassing the 15,000 MW threshold required for Stage 2 load-shedding.
Thus far, the utility has managed to avoid widespread blackouts but has leaned heavily on expensive diesel-powered open-cycle gas turbines (OCGTs), with the load factor for these units more than doubling from 5.78% to 11.73% over the year.
Eskom has expended R4.51 billion on diesel thus far this financial year, producing 768.64 GWh of electricity—more than double the 378.75 GWh from the same period last year.
While Eskom anticipates a reduction in diesel use as more power units return from maintenance, it continues to rely on this costly fuel to keep the grid operational, all the while considering long-term solutions like Bitcoin mining and AI for its financial stability.
Increased Scrutiny of Global Bitcoin Mining regarding Energy Use and Emissions
As Eskom implements a $22.7 billion debt relief plan aimed at stabilizing South Africa’s power utility, the global focus on energy consumption—particularly from Bitcoin mining—is intensifying.
A 2024 peer-reviewed study published in Nature Communications pointed to U.S. Bitcoin mining facilities emitting significant levels of harmful fine particulate matter (PM2.5) across state borders, impacting nearly 2 million individuals.
The 34 largest mining operations consumed a staggering 32.3 TWh of electricity, outpacing the energy use of Los Angeles by 33%, predominantly relying on fossil fuels. This has created pollution hotspots from New York to Texas, revealing both regulatory shortcomings and health risks.
This situation has rekindled international criticisms regarding the energy demands of crypto mining. While a report from Cambridge indicates that 52.4% of Bitcoin mining now utilizes sustainable energy sources, natural gas has recently surpassed coal as the primary energy source, reflecting inconsistent progress.
Conversely, the U.S. sector is encountering new challenges, including proposed tariffs of up to 36% on imported mining equipment under previous trade policies, which have sent shockwaves throughout the industry.
