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Jan de Lange

Eskom after Maroga, Godsell

Jan de Lange | Tue, 17 Nov 2009 11:24
[miningmx.com] -- IT WILL only take a fraction of a second before a shortage in Eskom's electricity network paralyses the country.

The effect will be immediate and violent. The network was developed in such a way during the apartheid years that certain parts of the country are shut down automatically to avoid a total collapse of the entire network - a blackout - as far as possible. That was a precaution against sabotage.

That's why the term load shedding is used. Apparently in the past, a computer decided which parts would be cut off, but during the electricity crisis in January and February 2008 this was changed so that it could be done at random in the network control centre in Germiston.

A total collapse - blackout in engineering slang - would leave the whole country without power for about a month - a nightmare in which food would go rotten and no lights would come on. It is to be hoped that this will never happen, but it very easily could if wrong decisions are made at crucial times when the reserve margin is as low as it is now.

Former Eskom CEO Jacob Maroga made bad choices in the run-up to and during the electricity crisis in January 2008. That cost the country R50bn in production losses. But this figure comes nowhere near telling the full story.

Gold Fields, which has one of the mining industry's most complex and electricity-intensive shaft systems in its Driefontein, Kloof and South Deep gold mines on the West Rand, started labour cutbacks before the crisis. The crisis accelerated and hastened the process.

The gold-mining group offered an additional premium to those unfortunate workers it had to dismiss because the cutbacks had to be done speeded up. It was certainly not Gold Fields' intention to harm anyone, but workers and trade unions christened it the "Eskom sweetener".

Smear tactics of the lowest kind

That's just one example. Dismissals because of the electricity crisis were followed by the worldwide economic crisis and an excessively strong rand, which is in the process of stifling our other non-mining exports.

The point is this: National Union of Mineworkers (Num) general secretary Frans Baleni and trade federation Cosatu general secretary Zwelinzima Vavi know better than most how much Maroga has harmed the country by waving aside warnings that coal supply lines to power stations were in the process of collapsing.

ANC secretary-general Gwede Mantashe, who himself cut his political teeth as Num general secretary, is also under no delusion about Maroga's incompetence.

All three of them also know Bobby Godsell and know that the race card played by Maroga along with the Black Management Forum (BMF) and the ANC Youth League is nothing but smear tactics of the lowest kind. More than that, as active role players in the economy they wanted Maroga out of Eskom, because he is endangering the interests of their members.

It's also not because of any particular sense of justice that Public Enterprises Minister Barbara Hogan wanted Godsell back as Eskom chairperson, a request he has subsequently declined. His corporate expertise and skills in the mining industry would have made him just the man for the job. Eskom and the country desperately needed Godsell.

Hogan started duelling with President Jacob Zuma, who interfered with the board's process of dismissing Maroga. And, to everyone's surprise, she emerged victorious, probably because she had Mantashe (and common sense) on her side.

However, Eskom will now have to submit its rate application to the National Energy Regulator of South Africa (Nersa) without a CEO and its former chair. There will also be enormous challenges facing whoever gets appointed to these positions.

Government oblivious

The electricity crisis is far from over. Last year, the National Electricity Reaction Team (Nert) was formed. It's a formal body consisting of high-level representatives of at least three state departments, the Chamber of Mines, and several business and trade union representatives.

Business representatives involved in this are deeply concerned, because it has been months since Nert last met. None of Nert's key officials were ever appointed. The director-general of energy was supposed to be Nert's chair, but this is one of the Zuma administration's new departments for which no DG has been appointed yet. Public enterprises director-general Portia Molefe was supposed to act as chairperson, but she has resigned and is not attending meetings.

Meanwhile, the building programme for new power stations is falling behind. Ingula, the hydro-pumped and storage power station in the Drakensberg, is apparently 17 months behind schedule, Kusile is 15 months behind its building schedule and Medupi 12 months.

Medupi only has enough water for the first three of its six generating units. A project for laying on water from two dams still has to be finalised. Servitudes for laying on power lines from Medupi to the national network also still have to be finalised.

"It looks as if we won't have enough electricity from 2011 to 2019. We are facing another crisis, but the government doesn't realise it," said a highly placed source who is directly involved.



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