South Africa

DAILY MAVERICK WEBINAR

South Africa’s energy crisis not quite a National State of Disaster, say panellists

South Africa’s energy crisis not quite a National State of Disaster, say panellists
Business Maverick journalist Ray Mahlaka. Daily Maverick Associate Editor Marianne Merten. Partner and Chief Economist, ESG Platform Lead, PwC Africa, Lullu Krugel. (Photos: Supplied)

The pandemic provided a good guide of how a National State of Disaster can be implemented as South Africa seeks solutions to ongoing and intensified national rolling blackouts. However, panellists warn that the energy crisis might not be a National State of Disaster but rather a problem that requires existing solutions to be implemented.

As the country experiences prolonged rolling blackouts with recent talk of declaring the issue a National State of Disaster, a Daily Maverick webinar suggested on Tuesday that while the national rolling blackouts are an energy crisis, the issue does not necessitate a National State of Disaster. 

The webinar, titled The Load Down: Eskom, Rolling Blackouts & National State of Disaster, was hosted by Business Maverick journalist Ray Mahlaka. On the panel was Lullu Krugel, Partner and Chief Economist, ESG Platform Lead, PwC Africa; as well as Daily Maverick Associate Editor Marianne Merten. 

Merten said the pandemic was a good example of how a National State of Disaster was carried out and what further steps needed to be taken. She added, however, that a pandemic is quite different from the current energy crisis. 

“The energy crisis is a crisis on a whole range of levels from agriculture, food security, right through to small businesses, big businesses, individual households, whether you are in an informal settlement, or in the leafy suburbs. So, don’t get me wrong; it is a crisis. I just really do not think that the energy crisis is a [National] State of Disaster,” said Merten. 

She added that the State of Disaster falls under the National Disaster Management Act 2002 and is overseen by the Minister of Corporate Governance and Traditional Affairs, as seen with Nkosazana Dlamini Zuma during the Covid-19 pandemic regulations. 

“The Disaster Management Act requires a few things to be in place which makes sense in a public health emergency, especially of the scale and the extent that Covid-19 was in early 2020… I think it’ll take some very interesting legal massaging to get the current energy crisis to stick and fit into the disaster state of requirements,” Merten said. 

Among the requirements for declaring a National State of Disaster is dealing with death, injury and disease, and the destruction of infrastructure and the environment, as well as that of the life of the community. 

Merten added that while the destruction of the life of the community can be used to declare a National State of Disaster, as South Africa has dealt with load shedding for the past 15 years and the energy crisis worsening in the past few years, using this as a loophole in the face of other regulations that could address the crisis would require legal manoeuvring; particularly so when the country’s citizens saw how the loosening of regulations under a state of disaster were abused, and aided personal protection equipment corruption. 


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The cost of load shedding

Mahlaka raised the debate over the cost of load shedding to the economy with Krugel, citing the Reserve Bank’s numbers of the blackouts costing the economy R1-billion a day. A Bloomberg article placed the exact economic loss daily figures at between R204-million and R899-million for Stages 3 and 6. 

Krugel said the number was a big debate and that an amalgamation of research pointed to unplanned power cuts cost about R50/kWh compared with Eskom’s R100/kWh. 

“If you’re a big business or wealthier households, there are solutions that you can start to bring into place to manage load shedding. So, if you look at the GDP impact, we might start to even get to a point where it’s not as bad as we think it is. But it would be a wrong perspective because areas where we need growth, new businesses, entrepreneurs, entrepreneurs, those kinds of things are really being hit hard,” said Krugel. 

Plan to end load shedding

Last year, President Cyril Ramaphosa announced an energy action plan to aid the end of load shedding, which includes improving the performance of Eskom’s power station fleets, accelerating procuring new generation capacity and increasing private investment in generation capacity. 

Read more in Daily Maverick:Here it is: Ramaphosa’s ‘energy action plan’ to end SA’s rolling blackouts

Mahlaka asked if Karpowership could be used to plug the energy shortfall. 

Read more in Daily Maverick:More late changes to gas explosion and noise studies as Karpowership enters final lap

Said Merten: “We have a crisis. We have the tools to manage the crisis. It is about implementation. And if the politicians might like a State of Disaster, I suspect, it really isn’t.”

Renewable energy 

A leading solution to the energy crisis has been ramping up renewable energy capacity – the recent shortfalls of the Bid Window 6 have shown that the national grid lacks capacity to onboard energy being generated by renewables. 

Read more in Daily Maverick:How the ANC’s years-long delays on renewables plunged SA into darkness and scuppered plan to end blackouts

Said Krugel: “Of course, we need to get out of coal and coal generation, but I think there needs to be a plan. And for me at the moment, it just feels like that plan is not there and all the pieces of the puzzle are not connected. So, we are focusing so much on ‘Yes, we can do this in generation’ and that’s okay, but what about transmission? So, I think that is a huge challenge!” DM

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Comments - Please in order to comment.

  • Colleen Dardagan says:

    Where can we find the UCT research on the cost of load shedding please – thank you!

  • Cunningham Ngcukana says:

    The problem is to separate a crisis from a disaster. A crisis is largely as a result of failures and pure incompetence and requires leadership at all levels to deal with such that has a grasp of the issues that are at the centre of the crisis and must have a credible implementable plan with time frames. This is the challenge at Eskom. There is a lack of grasp that Eskom is a massive engineering entity that requires systems of management and leadership at all levels with the requisite skills. As a national key point it requires security employed by Eskom with high skills not road side mechanics of BEE. It requires a CEO and board that appreciates the fact that the entity is primarily coal driven and focus on making the fleet work not a mealy mouthed CEO and board. The issue of IPPs must be removed from Eskom as they are confusing the CEO and the board. The issue of just transition when there is nothing to transition from is a mirage. We must move away from trying to be peacocks at international forums at the expense of our national interests. We must look at what India does and not what Germany does because the US is much a fossil fuel country and is one of the top emitters and they cannot teach anybody about renewables. The ANC needs to learn what constitutes our national interests as a country.

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