Enoch Godongwana. Picture: SUNDAY TIMES
Enoch Godongwana. Picture: SUNDAY TIMES

There needs to be sufficient energy capacity to give Eskom the space to do much needed maintenance, says ANC economic transformation subcommittee head Enoch Godongwana.

Earlier this week Business Day reported that the ANC lekgotla endorsed a market-friendly approach to the problem of SA’s energy shortage, including freeing up regulations around self-generation, allowing municipalities to procure their own energy and expanding the independent power producer (IPP) programme.

Godongwana said at Wednesday’s media briefing after the party’s lekgotla and a two-day national executive committee (NEC) meeting that the gathering spent an entire day assessing how the government runs state-owned enterprises (SOEs) such as Eskom.  

“Most of Eskom’s fleet is old so it requires sufficient time for maintenance ... If you are to do proper maintenance you need to shut down, which has implications for load-shedding,” he said.

Eskom, which supplies virtually all SA’s power, is hamstrung by maintenance issues, a R450bn debt and design flaws at the Medupi and Kusile power stations. Ratings agencies have identified the state power utility as the single largest risk to the economy.

Godongwana said Eskom should be given the space it needs to do maintenance and put in place emergency measures where additional capacity can be brought in. He said this was what the department of energy had done by issuing a request for information, which closes at the end of this month.

“The intention is to make sure that we can bring sufficient capacity so that we can give Eskom space to do the maintenance.”

Godongwana said that in terms of the IPPs, this was not new and the energy white paper developed in 1998 talked about the government and the private sector’s participation in this space. The IPP programme was a manifestation of that.

“I am sure given the complexity we are having now, they will play a critical role,” he said. 

In terms of self-generation and independent procurement by municipalities, Godongwana quoted from the ANC’s resolution: “Regulations should be eased to allow increased levels of self-generation in the economy and for municipalities in good financial standing to procure their own power.”

He confirmed that the ANC endorsed the easing of regulations to allow for this to happen.

The decision on independent procurement by municipalities comes as the DA-run City of Cape Town has approached the courts for permission to directly buy electricity from IPPs, an application that has been opposed by the ministry of energy. The case is expected to be heard in May.

ANC secretary-general Ace Magashule echoed what was said by President Cyril Ramaphosa in his closing address to the lekgotla on Monday.

Magashule said the structure and business model of public enterprises needed to be reviewed, and those that were strategic and under financial pressure needed to be prioritised. 

Appropriate forms of partnership with private companies, investors and workers will be considered where it will enable the public enterprises to better to fulfil their developmental role, he said. “The government must ensure that necessary skills are available for executive, management and technical roles.”

quintalg@businesslive.co.za