. (Delwyn Verasamy/M&G)
When the ANC elective conference reconvenes on 5 January for the adoption of policies, delegates will push for state-owned enterprises (SOEs) to be moved from the department of public enterprises to their line departments in a bid to improve efficiency.
This is according to ANC KwaZulu-Natal chairperson Siboniso Duma, who said the public enterprises department, led by Pravin Gordhan, cannot manage all SOEs on its own.
“One thing that is clear is that Pravin’s department is not able to help Eskom, Transnet, SAA et cetera on its own, look at all of them are crumbling and are in debt, what should happen is that the new NEC [national executive committee] should agree that he needs help,” he said.
“These state-owned companies should be rehoused in their line departments, rather than under the umbrella of Pravin alone.”
KwaZulu-Natal delegates supporting President Cyril Ramaphosa’s rival, Zweli Mkhize, suggested that Eskom be moved to the department of mineral resources and energy (DMRE), where both electricity generation and management of Eskom would be addressed.
Up to the delegates
If the more than 4 000 delegates agree when the conference reconvenes in January, Transnet and Eskom would be managed by the minister of transport and the minerals and energy minister respectively.
The KwaZulu-Natal delegates also said the state should not abandon its responsibility to play a developmental role and be the provider of public goods such as electricity and that a commitment must be made to strengthen Eskom.
The energy department is responsible for signing off on new independent power producer procurement projects and managing the programme that would bring additional megawatts to Eskom’s system to achieve energy security for the country.
“It only makes sense for DMRE to also manage Eskom because they are already in the business of energy security,” said a delegate from Mkhize’s faction
Policy recommendations of the ANC are incorporated into government policy.
“Delegates were saying can we ensure that state-owned entities are put into the line department for policy and coordination,” said the head of the party’s economic transformation committee, Mmamoloko Kubayi, on the sidelines of the conference at Nasrec in Johannesburg held from 16 to 20 December.
Kubayi said the ANC believed Eskom needed more engineering skills at the top.
Eskom chief executive Andre de Ruyter resigned last week, saying that sabotage and lack of political support pushed him out of the utility. The utility’s board is looking for his replacement, who will start at the beginning of April.
Eskom’s new chief executive will have to deal with the utility’s problems that include load-shedding, sabotage and working with the board to increase the energy availability factor to 75% from 59%.
Following De Ruyter’s announcement, the South African National Defence Force was deployed to protect Majuba, Camden, Grootvlei and Tutuka power stations.
Presidency spokesperson Vincent Magwenya said in a statement that this was “in response to the growing threat of sabotage, theft, vandalism and corruption at Eskom power stations”. The request was made by the presidency and the public enterprises minister, he said.
Too late
Energy expert Lungile Mashele said deploying the army was an action taken “a little too late”.
She recommended that Eskom should bring in skilled people from countries such as China and the United states to assist in addressing South Africa’s energy crisis.
The South African National Defence Union questioned why the police could not do the job.
The union’s spokesperson, Pikkie Greeff, said in a statement that he was concerned.
“One has to question whether it involves a power play by the current president, given the conference underway, or whether the deployment is based on real-time intelligence reports, or thirdly, whether it’s a combination of both.”
Energy analyst Matthew Cruise, speaking to EWN, said the deployment would help to prevent the sabotage of Eskom’s infrastructure by employees.
Long road ahead
Should the delegates vote for the move of Eskom to the energy department, it will also inherit the utility’s financial woes.
Cruise suggested that “a new electricity roadmap for the country in an updated integrated resource plan and a minister committed to implementing it, is critically needed. Also, the independent power producer procurement programmes need to be rolled out with speed.”
Energy experts have urged delegates not to approve the move of Eskom to the energy department, particularly if it is still under Gwede Mantashe, saying his attitude towards renewable energy would derail the ailing power utility.
Mantashe, who is a firm believer in coal, has been reluctant to move to renewable energy and has often delayed the signing of such projects.
Energy analyst Chris Yelland said he did not believe the department under Mantashe had the capacity to manage a utility such as Eskom.
“This would jeopardise SA’s ability to achieve its nationally determined contributions to reduce greenhouse gas emissions aimed at slowing down climate change. It would also get in the way of SA’s achievement of a just transition away from coal-generated energy,” he said.
Eskom has debt totalling more than R349 billion. The treasury has promised that it will take half of the utility’s debt into its balance sheet.
During his mid-term budget speech, Finance Minister Enoch Godongwana warned that SOEs are a major risk to the fiscal framework of the country. In response to that, he announced Eskom enabled the private generation of electricity.
This would mean that households could use renewable energy to give Eskom the ability to balance the grid.
The treasury supported Eskom’s quest to amend electricity regulations to enable municipalities to generate their own electricity or buy directly from independent power producers.
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