SA is looking to a future without an Eskom monopoly over country’s energy supply
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JOHANNESBURG - PRESIDENT Cyril Ramaphosa yesterday said that South Africa was working towards breaking Eskom’s monopoly over energy supply in the country.
Ramaphosa told the virtual World Economic Forum (WEF) Davis Dialogues that he was in the process of roping in private players in the industry and allowing local municipalities to generate their own electricity.
He said the move would allow the government to rapidly expand its energy generation capacity.
“This will be done with a focus on significantly increasing the contribution of renewable energy, battery storage and gas technologies,” Ramaphosa said.
“These measures aim to bring on an additional 23 percent of generation capacity into the system by 2022.”
Minister of Mineral Resources and Energy Gwede Mantashe has previously indicated a softening of the government policy, saying those municipalities in “good financial standing” would be allowed to develop their own power generation capacity.
Eskom commands a substantial market share of South Africa’s energy demand as it supplies about 95 percent of the country’s electricity supply.
The utility is currently struggling to meet the country’s energy demand due to the ageing infrastructure, while it is also laden with a mounting debt north of R480 billion.
Its failure to meet the country’s energy demand and erratic power cuts have been cited as South Africa’s biggest threat to economic growth.
Ramaphosa said efforts to restructure Eskom by splitting the company into three parts – generation, transmission and distribution – had gained momentum.
He said this would enable a more competitive, sustainable and efficient energy system.
However, Greenpeace Africa criticised Ramaphosa for “peddling 20th century solutions to 21st century problems”.
Greenpeace climate and energy campaign manager Happy Khambule said Ramaphosa and other world leaders needed to show that they had the courage to change a system that was actively working against the planet.
“The president’s address should have given clear commitment to achieve a rapid just transition away from fossil fuels towards renewable energy,” Khambule said.
“A diverse energy mix is not a move away from fossil fuels, on which South Africa is still dependent.”
Intellidex’s Peter Attard Montalto said the government should liberalise the energy sector to allow the private sector in.
Attard Montalto said the problem was that social partners were all quite content with tick-box policymaking, supposing that the Integrated Resource Plan 2019 would solve all problems.
“This is far from accurate. At the time it was released there was such a relief and a view that it would unlock Renewable Energy Independent Power Producer Procurement round 5 immediately and its flaws were ignored,” he said.
“Instead, we are stuck with a plan that will lead to record levels of load-shedding in the coming three years as the economy slowly recovers, constantly butting up against energy constraints.”