Posts Tagged ‘eskom’

Mantashe is spanner in the works of President’s energy promises

February 17, 2020

While the Democratic Alliance (DA) welcomes President Cyril Ramaphosa’s announcements in his State of the Nation (SONA) address regarding the energy sector, it is worrying that Mineral Resources and Energy Minister Gwede Mantashe does not seem to be on board.

Shortly after Ramaphosa announced during SONA that Independent Power Producers will be able to sell electricity to financially viable municipalities, Mantashe contradicted him in media interviews afterward by saying he is unwilling to commit to opening Bid Window 5.

This essentially makes the president’s promise an empty one.

A limited number of IPPs have received licences to provide electricity to the grid, following the opening of four and half bid windows so far.

The Integrated Resource Plan calls for more renewables to be added on an annual basis, but Mantashe has to open the next bid window, which will be the fifth one.

He has not done so, and judging by his statements last night he does not intend to do so anytime soon.

Mantashe has also continuously delayed the signing of section 34 notices, and has been slow to act on the amendment of schedule 2 of the Electricity Regulation Act.

Every day of delay of these urgent reforms is another day of rolling blackouts and another day of severe damage to the South African economy.

Minister Mantashe needs to come clean on what his immediate steps will be to implement the President’s promises without any further delays. We will hold him to account, as well as calling on the President to act against Mantashe if he continues to be the spanner in the works.

Reject Eskom’s proposed R 27.3 billion tariff increases

February 4, 2020

Eskom is currently in the process of challenging the electricity tariff increases previously approved by NERSA for 2019 to 2022, and now wants consumers to pay 10-15% more for electricity, followed by tariff increases of 50% over the next few years.

This, despite the fact that South Africans experienced over 418 hours of load-shedding in 2019 alone.

The DA’s main points of objection are:

  • Consumers simply cannot afford Eskom’s proposed tariff increases;
  • The utility has been entirely unable to demonstrate that they can operate prudently and efficiently, with gross financial mismanagement and procurement processes that have not been competitive enough; and,
  • Eskom has demonstrated that it is wholly incapable of managing South Africa’s electricity supply. To allow an increase in the rate of their tariffs would only reward them for their failures.

The DA has therefore called on NERSA to reject this application, and to protect consumers from Eskom’s incompetence.

With over R400 billion of debt, the ANC must accept that Eskom can no longer be saved and that the lunacy surrounding Eskom bailouts, in any form, needs to end now.

South African consumers cannot afford further tariff increases on electricity. It is unconscionable that Eskom would ask citizens to pour more money into the blackhole of an entirely defunct SOE.

Eskom cannot be fixed – independent power production is the future

January 31, 2020

The ANC government and its utility Eskom, are unable to meet our nation’s energy needs, and there is no plan to fix this. The DA firmly holds that Eskom’s constant limping from light into darkness cannot continue.

Eskom continues to suffer financial catastrophe, being billions in debt. It blows through bailout cash, and it has proved for years that it cannot recover massive consumer debt owed to it.

Eskom remains operationally weak, and its infrastructure continues to fail and to not meet demand. Its power generation mix is archaic, and has no way to move to cleaner more affordable energy.

These are signs of an entity which cannot be saved. We maintain that it is in a death spiral, and for so long as the ANC government continues to pretend Eskom can be saved, it is dragging South Africa with it down this spiral.

It is deeply concerning that while rolling blackouts continue, transparency and disclosure at Eskom remain elusive – contracts, short, medium and long-term operational and restructuring plans, and importantly a solution to the financial crunch it is experiencing, are kept secret and not disclosed to Parliament for oversight.

The DA has previously requested that the Chairman of the Portfolio Committee of Public Enterprises, Khaya Magaxa, convene an urgent meeting on these issues at Eskom, but to no avail.

The DA has also asked the Minister of Public Enterprises, Pravin Gordhan, for a meeting to address the electricity crisis and help the nation find solutions, and are awaiting a response thereto. We are absolutely committed to work to find solutions.

In the interim, Eskom demands more price hikes, requests additional funding to the tune of billions, and then promptly announces more looming loadshedding. To what end for our nation?

It is high time for alternatives, including breaking-up Eskom, immediately freeing-up space for all independent power producers, investigating aspects of privatisation and allowing South Africans to make their own electricity generation choices in their own businesses and homes.

Another R 17 billion bailout for Eskom

April 22, 2019

Finance Minister, Tito Mboweni, has tabled a report which details a R 17 billion bailout for Eskom due to an emergency cash problem – this points to a power utility that is no longer viable and sustainable.

Eskom is using money to literally pay salaries and keep the lights on by burning through billions of Rands worth of diesel until after the elections.

The DA has proposed a bill that would allow for the introduction of independent power producers that would cheapen the cost of electricity, bring about much needed competition, but these solutions were never adopted.

Five solutions to keep the Lights on

March 23, 2019

The recent rolling blackouts, set to intensify, show that Eskom’s operations have reached the level of a national crisis. Millions of jobs and livelihoods are now at stake.

This was inevitable given the extent of mismanagement, corruption and bad policy that Eskom has been subjected to over the past two decades.

A total collapse now seems possible, but it is not inevitable. There are five things South Africa can do right away, to avert the monumental catastrophe of a full-scale blackout.

Firstly, the energy production market must be fully opened to competition. This would ideally, but need not necessarily, include privatising the generation entities of Eskom.

Competition will rapidly increase activity, innovation and efficiency in energy production, enabling more energy and a more diverse range of energy to enter the grid.

Decentralised production, diversification and increased supply will bring down electricity costs and build resilience into the system.

The current high prices and unreliable supply of energy is due to the socialist approach of giving a single, state-owned entity monopoly control of our energy market. If we did the same with our bread market, we’d very soon all be queuing for over-priced bread.

Secondly, Eskom should immediately freeze the build process of the last two outstanding units at Kusile. Those funds should be redirected to purchasing electricity from independent power producers.

The Medupi and Kusile builds have major design and build flaws thanks to extraordinary levels of corruption and are thus not worth proceeding with, since they cannot deliver anywhere near the promised capacity.

Thirdly, engineering and maintenance at Eskom should be classified as an “essential service” that cannot enter into strike action.

Otherwise, this crisis puts union bosses in a position to hold our entire economy hostage to their demands for ongoing above-inflation wage increases. We must preclude the possibility of extortion.

Fourthly, major smart meters must be installed for municipalities, to force municipalities to collect revenues and pay Eskom timeously.

Eskom’s financial and operational crises are irrevocably interlinked, because the worse Eskom’s finances, the less maintenance is done on its infrastructure. The more unplanned outages Eskom experiences as a result, the less electricity it is able to sell and thus the deeper it slides into debt.

Fifthly, well-functioning metros and municipalities must be allowed to source energy directly from independent suppliers. SA cannot continue with Eskom being a monopoly buyer and seller of electricity.

This is a classic case of having all our eggs in one basket. For example, if you have solar panels on your roof, you should be able to sell the excess energy you produce.

Most municipalities in the Western Cape already have legislation in place to buy and sell alternative sustainable energy such as solar energy.

The DA is currently pursuing court action against the ANC government to win the right for local governments to buy and sell energy directly from independent producers. As soon as that legal battle is won, our local governments can hit the ground running.

DA-led governments have taken proactive measures to reduce the risk imposed by this avoidable crisis. Most importantly, we have prioritised investing in, maintaining and upgrading the electricity distribution infrastructure to avoid outages due to local breakdown.

The City of Cape Town also maintains and utilises the Steenbras pumped-storage scheme to supplement electricity supply during periods of peak demand.

This means the City is sometimes able to avoid load-shedding or remain on a lesser stage than Eskom requires. And the City is investing in a natural gas distribution network to increase energy supply and resilience.

Only mass action can compel the national government to take the five steps needed to avert a total collapse of our electricity system.

That is why I am calling for a National Day of Action on Friday 29 March. I urge every citizen who loves South Africa to join this mass call for radical reform to our system.

Of course, our most powerful action would be to cut off the ANC’s power on 8 May. At the end of the day, this crisis requires strong leadership that will stand up to union bosses and ensure change occurs.

The advantage of the DA is that whilst we recognize the role of unions, they are not voting delegates at DA congresses.

Warm regards,

Mmusi Maimane
DA Leader

Its time to dismantle Eskom

July 25, 2018

Eskom’s latest financials once again reiterates the need for a complete turnaround strategy for South Africa’s energy sector.

The DA plans to introduce a Private Members Bill aimed at dismantling Eskom and creating a separate public entity which will govern and manage the country’s electricity grid and transmission lines.

The remaining part of Eskom, responsible for generation, will be privatised and compete on an equal footing with other entities, including renewable companies, for generation capacity.

This will ensure a more efficient, reliable and competitive energy sector which will not only prioritise service delivery to South African citizens but will also lead to much-needed job creation and foreign investment.

The reality is that Eskom is facing collapse and it will continue to stumble from one crisis to the next until such reforms are implemented. It’s clear that the new dawn has simply remained a slogan at the power utility as there has been very little change.

The DA will continue to fight for an efficient and transparent Eskom.

South Africans deserve a power utility that delivers reliable energy to the economy to empower it to grow and create jobs for the 9.5 million unemployed South Africans.”

Sign the petition – Eskom management must pay back the money

March 31, 2015

Since load-shedding began in 2008, Eskom’s top brass has received a staggering R63 million in performance bonuses. In 2012 and 2013 alone, these bonuses amounted to R31 million.

eskom crises

Bonuses for doing what exactly?

These bonuses are in addition to their massive salary packages (Eskom’s top 3 executives earned R24.4 million last year).

The Eskom monopoly has dumped South Africa in a crisis through incompetence and mismanagement. Their “performance bonuses” are an insult to every South African.

Every cent of these bonuses must be returned, and all future bonuses must be placed on hold until we emerge from this crisis.

To sign the petition, click here

Give power to the people

February 4, 2015

power stats