JOHANNESBURG - South Africa long ago started to move down the slippery slope of losing its security and sovereignty. The most recent has been where corruption and state capture by individuals and foreign nationals became the order of the day.
Hopefully, repair processes have started but it will take years before the damage of the Zupta years is fully repaired. However, there is a slow but insidious and unrelenting loss of security and sovereignty taking place. One would think this process was taking place behind closed doors but amazingly it is taking place virtually in the open and with full or tacit approval of many citizens.
The damage being caused is generational and will effectively confine many citizens of South Africa to poverty for a generation if it is allowed to continue. The process taking place will lead to widespread energy poverty. This will inevitably result in slow unsustainable and unstable economic growth less than 2.7 percent per annum and with it will come high unemployment above 35 percent compared to current levels of 27 percent. These events create a landscape with all the potential for a Venezuelan style socioeconomic political revolution. Economic insecurity leads rapidly to a loss of economic sovereignty.
The first phase has already occurred where capture, mismanagement and political interference of the affairs and contracts of Eskom has resulted in delayed construction projects, particularly Medupi and Kusile, and many other areas of mismanagement, only now being highlighted. This has resulted in load shedding and excessively high electricity pricing. Essentially it has threatened the security of the country by weakening electricity supply and in the end opened the door to losing the country’s sovereignty to idealistic, financial and foreign interests.
The second phase is well under way at present. There are a host of idealistic, financial and foreign parties insidiously, often collusively, steadily destroying South Africa energy security and sovereignty. One can actually break them down into categories:
- First, some of the country’s premier research institutions have effectively been captured by the new group think paradigm, namely that the only way forward is by having high penetration renewable electricity generation primarily in this country wind and solar. In fact, almost without exception this solution has led to substantial global economic damage and costs. Practical examples include Ontario, Minnesota, S Australia and even in Germany itself. In Germany it has resulted in some of the highest electricity prices in the world with only marginal signs that prices will fall. The fact that Germany has managed to overcome the damaging calamity of renewables has more to do with the fact that it can import and export electricity to its neighbours, who in fact are using primarily sound base load coal (Poland), nuclear (France) or Hydro (Switzerland and Scandinavia). Importantly it is part of a relatively weak Euro dominated financial system. Even more important Germany has effectively sold its sovereignty to Russia for its gas. That is something of intense concern to German and European leaders (quietly of course) and the US administration.
- Second, it is interesting to note that China, India, the ASEAN countries, Eastern European countries and Russia have steadily paid lip service to the IPCC and COP21 and all are in the next 20 years substantially increasing their dependency on fossil fuels and nuclear. Clearly, they have done the sums and know that this gives them three clear advantages, lower electricity prices, security of supply of electricity and energy security and importantly a greater degree of sovereignty. In practice it leads even to economic superiority over the relatively weakening Western economies. If only Western countries would learn that Eastern countries, particularly China play a very long game of Chess or Mah-jong.
- Third, renewables particularly solar and wind are the most inefficient forms of energy available to human beings. They are not the cheapest as are proclaimed by their supporters. They need 100 percent back up. Grid costs are far higher than claimed and there are high economic risk costs associate with high penetration wind and solar. Its radical and idealistic supporters cannot name anywhere in the world where high penetration renewable solutions have been known to work. Nowhere in the world can examples be given of this solution leading to lower electricity prices or higher economic growth. Examples of wide economic damage are widespread. But, of course, these are ignored. Under these circumstances one can only conclude that their models and their assumptions are not just badly flawed but fatally out of touch with reality.
- Fourth this leads to the question why such a powerful lobby group for this form of electricity generation is there at all. This is an easy one to answer. There is an enormous amount of money involved principally in Africa and particularly in South Africa. If renewables is given the unrestricted go ahead being recommended by its supporters then one is looking at a cost on wind and solar alone of almost R1.4 trillion. This is where South Africa loses its sovereignty. There are of course a number of parties involved because there is a large piece of cake to be divided. First and foremast most of the jobs will be created abroad. Overseas suppliers primarily wind turbine and equipment suppliers in Germany are the big winners. Down the list but definitely sharing the booty is China with solar panel suppliers. Now they are also increasing their manufacturing facilities although South Africa is a mere triviality in their national plans. Of course, behind them come a fair share of experts and lobbyists who will be sharing in the spoils of advertising and marketing expenses. Like the Germans to Russia we will lose our independence and security and sovereignty to overseas suppliers. In South Africa’s case primarily to Germany.
Finally, sadly, there are two other substantial partners sharing the guilt of looting and ensuring the loss of security and sovereignty. The first are South African financial institutions. They all have big green departments to feed but more important they can now invest in what is in effect an index linked bond guaranteed by the government. They just clap their hand and wait for the money to roll in. The government is no better apart from various deals with shareholders that may or may not be taking place. The South African Revenue Service cannot wait to lay its hands on the additional revenue from Carbon Tax. Neither overseas suppliers the financial institutions or SARS cares where the money is really coming from. Actually, it is the poor. Overseas renewables and the carbon tax are known as taxes on the poor. Pass through tariffs are ultimately paid by the poor.
In conclusion all the above adds up to the fact South Africa and its citizens, primarily made up of unsuspecting genuine believers in a cleaner society and a poor, are being manipulated by an educated class of domestic and foreign individuals and institutions. These individuals and institutions have vested idealistic and financial interests. In summary they are trying to lead South Africa down a renewable route which will result in South Africa losing its energy autonomy, security and ultimately its sovereignty. South Africa indeed faces a dark future.
Rob Jeffrey is an independent economic risk consultant. He is the former MD of Econometrix and continues to consult for them.
The views expressed here are not necessarily those of Independent Media.