THURSDAY, 12.15PM:
A DRAFT white paper on energy policy released on Wednesday may see the complete deregulation of the liquid fuels industry in South Africa, which will involve phasing out the rigid control over the price of fuel, allowing prices to be determined by market conditions.
Business Day reports that the paper, announced by Minerals and Energy Affairs Minister Penuell Maduna, also proposes that government subsidies to parastatals Mossgas and Sasol be stopped by next year.
The complete deregulation of the industry involves lifting a number of the rigid control mechanisms that have allowed the state to control the industry.
Firstly, control over the import and export of crude oil will be phased out — although while price control remains, import parity pricing will be retained.
Secondly, the rationalisation plan, a voluntary agreement between the state and wholesale industries, will be terminated. This will see a move away from service stations to self-service of petrol, as well as a ban on “vertical integration” in the industry, which excludes wholesale marketers from operating service stations.
The white paper does concede, however, that the deregulation could have a negative effect on labour and small businesses in the short to medium term as a result of the job losses that a move to self-service will necessarily entail. Currently, there are 4900 service stations employing 45000 pump attendants in South Africa.
The document has been submitted to the National Economic Development and Labour Council (Nedlac) for debate and Parliament’s portfolio committee on minerals and energy will hold public hearings at a later stage, Maduna said.