Despite fears that the catastrophic energy state announced by President Cyril Ramphosa last month will fuel corruption, Eskom chief executive Calib Cassim believes the move will give Eskom room to breathe – and stop the load.
Cassim spoke at a media conference on the disaster situation on Friday.
He emphasized that the R254 billion treasury allocation to Eskom in this year’s budget for debt relief will help the ailing parastatal.
“The decision of the finance minister [Enoch Godongwana] that Eskom does not have to go into debt for the next three years allows Eskom to release capex [capital expenditure] funds three years before, not only for generation, but for transmission and distribution.
“[With] the flexibility that currently exists in procurement in government regulations, there is no reason from Eskom’s perspective and from the perspective of generation… [I don’t see] why load-shedding [should not be] decrease forward.
“We don’t have to accept stage six [load-shedding]; we need this stage to come down,” he said.
Another generation
Rudi Dicks, head of the project management office at the presidency, said the debt relief would also allow Eskom to buy more electricity from neighboring countries and private companies.
“The changes that have been made in terms of new generation capacity, especially through IRP [Integrated Resource Plan]that Eskom is not the only entity responsible for building new generation capacity.
“We have the ability to get new generation through IPP [independent power producers]. So, it is important to understand that this is not necessarily a new build by Eskom but the ability for Eskom to get additional generation,” he said.
Dicks said the regulations allow the government to open a one-stop shop to speed up applications to register businesses to build new generation projects.
“One-stop shop is currently being formed in the department of trade, industry and competition for business registration.
“We are in the process of finalizing all the necessary requirements for the establishment, including alignment with the department, having a system in place and ensuring that we have an agreement between all institutional systems, entities and the government,” he said.
A proper audit
Cooperative Governance and Traditional Affairs Minister Nkosazana Dlamini-Zuma said during the pandemic, the government has tried to ensure funds for emergency procurement are not misused and will prevent abuse of power in this disaster situation.
“That’s why the auditor general will carry out a real-time audit. We also said that the accounting officer must report to parliament, if he uses emergency procurement, according to the regulations, every month, so no one abuses the regulations.
Dlamini-Zuma said the regulations were intended to reduce the effects of reducing the burden on the economy, livelihoods and health, agriculture, security, education and water services.
“It is also intended to reduce and manage the impact of load shedding on the delivery and support of the infrastructure that saves it. It also provides measures to enable connectivity and … for Eskom to improve the performance of plants and electricity supply.
It comes at a time when the power utility is fighting internal corruption and facing a court battle against the disaster state, brought by opposition parties and unions.
Dlamini-Zuma confirmed two court cases challenging the declaration were filed.
The Democratic Alliance (DA) and the Outa group have filed a court case against the government for declaring a state of calamity, which they consider unnecessary.
Legal representative Stefanie Ficks said Outa hopes to get the decision to declare a state of disaster reviewed and set aside by the court.
DA spokesperson Solly Malatsi said the party believes it has a strong case against the state of disaster and will await court proceedings.
DA and Outa said that the disaster situation will be a place for corruption and theft of funds.
But Dlamini-Zuma insists the government has learned from the Covid-19 personal protective equipment corruption scandal. He admitted a “real-time audit” of Covid-19 procurement was too late, leaving room for abuse of the process.
“But this time, the audit process governing fast-tracked applications will be direct, with additional monthly reports to parliament.”
“The accounting officer must go to parliament every month about the work that has been done and the money that has been spent. They will be accounting for the public,” he said.
Mandisa Nyathi is a fellow climate reporter, funded by the Open Society Foundation for South Africa.