Minerals Council urges Govt. to allow private money help re-wire SA’s energy sector

SOUTH Africa’s mining industry has called on Government for a mindset overhaul in respect of the country’s electricity supply, saying that load-shedding was tantamount to an industrial policy decision to “downscale the … sector”.

State-owned power utility, Eskom, lost critical generating capacity this week owing to a combination of heavy rains that soaked coal, flooded a mine and caused a conveyor to break. It consequently asked the Minerals Council South Africa to ask its members to switch electricity off to all but essential services.

According to the council’s CEO, Roger Baxter, the impact of some 6,00MW in load-shedding that followed was to hurt mining production for a week even though mines were only idled for about a day. That’s because crews would have to go back in and first stabilise areas from a safety point of view before mining can resume.

He has asked government to sweep aside the bureaucracy that currently prevents the privately-financed mobilisation of energy – a step that would see the creation of a one-stop shop led by departmental director-generals including minerals resources and energy.

The council wants to see rules relaxed and red-tape cut enabling for embedded generation where mines produce power for their own requirements. This would be cost-free to the fiscus providing Eskom with the space to undertake the radical restructure it requires. Just as importantly, the council wants government to sign into action the next phase of  independent power production projects.

These steps are the mere swish of a pen away but minerals and energy minister, Gwede Mantashe, has been reluctant to make the move. No-one finally knows why he’s reluctant: there’s talk of his loyalty to coal production, but the deeper reason may be that there’s no consensus for it in the ANC owing to the freedom it grants private capital.

President Cyril Ramaphosa hinted on December 11 that the government would invite the private sector to build alternative power capacity but the current suggestion involving the construction of power barges and the like is stop-gap in nature.

“Government should stop trying to place all their eggs in the one basket called Eskom,” said Baxter. “We urge government to take decisive steps not only to fix Eskom but also to enable the private sector to bring on stream substantial self-generation capacity.”

“We need concrete action plans and accountability for delivery and we are asking government to unleash the energy of the private sector to help resolve this national electricity crisis,” he said.