One commiserates with Energy Minister Mmamoloko Kubayi, who has to deal with Eskom’s delay in signing agreements with independent power producers (Eskom "has not signed" deals with power producers, May 17).
SA’s Renewable Energy Independent Power Producers Programme has been globally lauded and is a great promoter of fixed investment, but Eskom is delaying the signing of agreements to frustrate the producers into quitting. The utility puts forward pricing as an argument, but the industry understands an efficient and diversified energy supply at a predictable price trajectory will benefit faster economic growth more sustainably than the boom-and-bust risk associated with initially cheap, centrally produced energy from coal and nuclear.
Eskom has acquired its own interests over its long history, which has found some alignment with state-capture agendas. Policy decisions by the government or the ANC won’t help much before there is alignment with a reform-minded board and management. It was therefore correct for organised business to call for the Eskom board to be replaced.
It is also right that ANC legislators and leaders swing more towards the unbundling of generation from distribution to open up empowerment opportunities, rather than hang on to a 1920s-style behemoth for its unsustainable procurement power to benefit a few with enrichment opportunities. This has now found some tentative expression in the draft policy documents going into the ANC’s policy conference in late June.
Fixed investment is most sustainably promoted when investors can budget to scale up and down to meet clear off-take sightlines and factor in any rehabilitation of human livelihoods and environmental costs. Eskom undermines that principle in delaying the signing of the agreements. Some political courage will minimise cost and benefit SA’s economy and its people for generations to come.
Coenraad BezuidenhoutParktown North