KHANGELA BALOYI: Socially owned energy mix the only solution to SA’s crisis

The only way to address the electricity crisis in SA is to allow for a proper energy mix. We also need to make sure that the generation, distribution and transmission of electricity remain in the hands of the state.

The privatisation of electricity generation, distribution and transmission will only result in electricity poverty. It will perpetuate the imbalances of the past. Poor people will be sidelined and remain without energy.

SA remains the most unequal society in the world, according to World Bank statistics. The only way to change this embarrassing state of affairs is to allow government to intervene in economic activities.

The plan to unbundle Eskom is the first step towards privatising it. The trajectory that has been taken by President Cyril Ramaphosa’s administration is that of putting the interests of the private sector first.

We have witnessed the deliberate destruction of state-owned companies to put them in private hands. It happened to SAA, the SA Post Office, Denel, Prasa and now Eskom. All of these entities have been reduced to insolvency to privatise them. The modus operandi is to destroy all state-owned companies and build from their ashes new but privately owned entities.

Eskom is forced to stop using coal as the primary energy source in favour of renewable energy. Most of these renewables come in the form of privately owned entities or renewable energy independent power producers (REIPPs). What is of great concern is that most of these REIPPs are owned by foreign companies with minority shares owned by politically connected South Africans.

While fundamentally there is no problem with renewables, the problem is the way the renewables are structured in this country in terms of ownership. Renewables are necessary for a balanced energy mix, but they must be socially owned. The private sector and its free-market rhetoric are not for social justice but for profit maximisation.

Poor South Africans will not be able to afford electricity produced by the private sector. Small businesses are already closing down due to load-shedding, unaffordable electricity prices and the effects of Covid-19.

The concern with the arrangement where most REIPPs are foreign-owned is that it undermines our sovereignty as a country. We need to learn from the current events in Europe, especially Germany, which closed its nuclear and coal power stations in favour of renewable energy, supplemented by gas. However, this is mostly supplied by Russia, and the war between Russia and Ukraine is creating serious energy security problems for Germany.

Most renewables are not reliable. The sun doesn’t shine every day and the wind doesn’t always blow. For this reason Germany has had to start to rely more on imported energy from countries such as France and Russia. For a country to remain uncompromised in terms of energy security of supply it needs to be self-sufficient.

The energy sector must be democratic. It must respond to social challenges, be socially owned and there must be security of supply. An energy sector that is private and foreign-owned will compromise security of supply when there are conflicts.

We need to learn from the energy crisis that rocked California in 2000, which was caused by, among others, the privatisation of the energy sector. The problem was that during difficult financial times when private companies are not profitable, they just close down regardless of the fact that they are producing essential energy for the country.

This realisation must inform us as a nation to make energy a public-owned sector. The free market economy is not for social justice but for profit maximisation. We cannot compromise the security of supply to please free-market lobbyists.

Energy security of supply is at the centre of the security of our sovereignty. If the supply of energy is controlled by foreign private hands they can easily sabotage us during times of war.

• Baloyi is National Union of Mineworkers energy sector co-ordinator. He writes in his personal capacity.