Who should be held responsible for the failure of Eskom’s recapitalization in the late 1990s to replace old power plants and expand generation capacity? In the past few weeks, we have been confused about electricity and fingers have been pointed at the actors in the struggle of state-owned and state-owned companies that are still in the renewable energy sector.
There is merit in the argument that André de Ruyter is not the recovery specialist that an institution such as Eskom needs. Criticism is also fair that the mine-friendly Gwede Mantashe may not be the right person to enter into reforms in the electricity market that will shrink the coal industry where he started working for the National Union of Mineworkers in the 1980s.
But they are only two characters in a long actor in the management of the broken energy market over the past 30 years. To place the blame on the shoulders or public company departments, Pravin Gordhan, and President Cyril Ramaphosa is a lazy assessment of the situation.
In last week’s coverage of the electricity crisis we tried to earmark the key players responsible for the country’s sorry Eskom. We have been rightly criticized for leaving out certain people and others claiming that they should not appear because they are doing their best for the ailing parastatal with whatever tools are available.
What is expected is the fact that there is no one person to blame, but the approach of the government since the first warning in the mid to late 1990s that the crisis is inevitable.
The management of the electricity supply has been a disaster. All presidents, finance, public companies and energy ministers along with countless board members at Eskom over the years must be held accountable.
In 1994, we had a population of about 43 million with a GDP of about $153.5 billion. Today, there are about 60 million and their current GDP is worth more than $419 billion.
This growth mainly occurred on the back of coal-fired power stations in Mpumalanga built in the 1960s and 1970s. This plant has an average shelf life of 41 years, which can be extended to 60 years if properly maintained.
Maintenance took a back seat as Eskom was unable to raise tariffs to a level that allowed it to maintain proper operations. South Africa’s National Energy Regulator has come under significant political pressure over the past 15 years from the ANC and opposition parties not to comply with Eskom’s demands.
This week, Ramaphosa joined the opposition benches to call on Eskom not to raise tariffs – a populist game he started earlier.
If there is no tariff increase and no debt solution for Eskom, then how will the electricity utility maintain its creaking infrastructure?
The hole was getting bigger.