This week, South Africa will mark 12 years since the advent of load shedding. It is a moment marked by Eskom moving to Stage Four on Friday, followed by a weekend of darkness and generator noise piercing the otherwise dead quiet spaces. While Eskom has explained time and time again the mechanical reasons for the problem, in essence, this has always been a political problem of managing and governing resources. It is sometimes forgotten how important the role of corruption has been in prolonging the biggest problem our country faces.
And it should not be forgotten that at all times, the people who made the mistakes, the people who indulged in corruption, and the people who have created the deep crisis that we are in now, come from, and were protected by, South Africa’s very own ruling party, the ANC.
When load shedding first began in 2007, it was a surprise for nearly everyone. But the people in charge of Eskom, energy and government at the time had no excuse for their ignorance. Nine years before, in 1998, an Energy White Paper had predicted that “for an assumed demand growth of 4.2%, Eskom’s present generation capacity surplus will be fully utilised by about 2007”.
How precisely right that estimate was.
Then-president Thabo Mbeki apologised in January 2008 for the load shedding (a lot had happened during December, including his loss in Polokwane). Importantly, Mbeki said, the government was taking “collective responsibility” for its failure to ignore Eskom’s warnings. While this sounded like a positive move at the time, it was actually a mechanism for ensuring that no one had to take responsibility personally for what happened.
Indeed, Susan Shabangu was the deputy minister of energy who wrote an introduction to that 1998 Energy White Paper. She remained in government until 2019, some 21 years later, and only after President Cyril Ramaphosa appointed his current Cabinet.
In a democratic system, one would expect that the lights going out would lead to a strong reaction from the governing party. Load shedding has been caused by a complete failure of governance, nothing else. But no correction has been forthcoming.
Now, Eskom produces less electricity than it did in 2007, when the first load shedding incidents happened.
Eskom now produces it at a much higher cost, which means that you are probably paying a lot more for the electricity you do use, while using less of it.
The number of workers used to produce it has gone up, too.
Instead of the expected response – that the ANC would make fixing the problem a priority – the party, almost as a collective body, appeared to use it to generate funds for itself.
It is difficult to see the role of the ANC’s investment company, Chancellor House, in any other way.
In November 2007, just a month before the first load shedding, Chancellor House bought 25% of the local arm of Hitachi. Hitachi wanted contracts to build the boilers for the new power stations, Medupi and Kusile. It won the contracts. The US Securities and Exchange Commission investigated Hitachi and found that this amounted to improper payments. Hitachi paid $19-million in fines to avoid further prosecution.
These boilers caused some of the problems that led to the generation issues at Medupi and Kusile. On Thursday 5 December, when the latest bout of load shedding began, energy expert Chris Yelland told SAfm Kusile produced not one watt of electricity.
All of this happened before State Capture began in earnest.
In May 2014, after that year’s elections, the then-president, Jacob Zuma, appointed Lynne Brown as minister of public enterprises. She was to oversee the appointment of Dr Ben Ngubane as chair of Eskom. They then both oversaw the appointment of Brian Molefe as CEO of Eskom. At the time, Molefe was portrayed as the “white knight” who was going to change everything, the organisational genius who could make Eskom produce more power. Many thought he was exactly the right person for the job.
He was not.
Instead, he, and others running Eskom, had other ideas. And generating power was not their priority.
Ngubane and Molefe told the then-mineral resources minister, Ngoako Ramatlhodi, to cancel Glencore’s mining licence. He refused. Zuma fired him and appointed Mosebenzi Zwane in his place. Zwane flew to Switzerland to help the Guptas close the deal to buy the Optimum Coal Mine on the cheap.
In the meantime, Molefe visited the Guptas in Saxonwold 14 times.
Unfortunately, more was to come.
Matshela Koko was the head of generation at Eskom. His stepdaughter was involved in a company that won hundreds of millions worth of contracts from Eskom.
Koko has always denied wrongdoing, and currently spends much of his life fighting people on Twitter. (He has spent money on this as Twitter has indicated that he has used “promoted tweets” in the past.)
Some will claim that this is not the fault of the ANC, that the party did not play a role in the corruption of Molefe, Ngubane, Brown, Zwane or Koko. Or Zuma.
But the ANC itself has said many times that it has a deployment committee, and that that committee oversees appointments to important positions at state-owned entities. Former public enterprises minister Barbara Hogan told the Zondo commission how important this body is. The party still refuses to discuss its workings, saying that they are internal.
But it is known that the committee is chaired by the party’s deputy president. Which means that Ramaphosa may have chaired meetings that led to the deployment of Ngubane and Molefe.
(It is also possible, however, that Zuma did not let the committee play much of a role in these appointments, and simply ordered Brown to appoint who he wanted to these jobs. It should not be forgotten that it was during this period that Zuma fired Nhlanhla Nene as finance minister and tried to appoint Des van Rooyen to the post in December 2015).
It was not just the ANC that was looting Eskom during this time. The consultancy McKinsey made a billion rand from the utility. (It has now paid the money back.) But it has not suffered any other consequence. Instead, it has gone on to help US President Donald Trump’s administration lower costs by making suggestions about decreasing the number of meals and the quality of the medical facilities available for refugees being held by the Immigration and Naturalisation Service.
Incredibly, it is not over.
Even now, Eskom appears to be paying more than it should for coal.
The ANC will no doubt deny that it should be held responsible and will explain how mistakes were made. But it has not, as far as is known, closed down Chancellor House. It has not even subjected people like Brown or Zwane (or Zuma…) to disciplinary processes. It has done nothing.
This appears to make the evidence that it allowed, or even ensured that this would happen, fairly overwhelming.
Certainly, it must be difficult to defend the party from the claim that it has created the power generation, and financial, crisis that we now face. But there are no signs that it is a big political issue in terms of elections. It did not come up during the campaigning period earlier in 2019.
And the opposition parties appear unlikely to make it much of an issue. Neither the DA nor the EFF is able to campaign properly on this because of their own internal problems.
This suggests that despite what strongly appears to be the ANC’s role in the current round of load shedding, and its perpetuation, very few consequences may follow, even in the very real likelihood of the credit downgrade, the country being plunged into darkness, the wheels of the industry grinding to a halt and South Africa’s economy crashing into a debt default. DM
This story was edited post publication to clarify when Chancellor House bought 25% of the local arm of Hitachi.
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