The lights have stayed on pretty much uninterrupted for the past three weeks, which means that (barring another cyclone or coal plant collapse) the electricity crisis won’t be top of mind when people go to vote on 8 May 2019.
Few people, however, understand how much it is costing Eskom (and by extension us) to create the illusion of energy stability.
Behind the scenes, Eskom is burning billions of rand of diesel every week, although everyone knows this is unaffordable and unsustainable.
In the Western Cape alone, it costs R6.3-million an hour for Eskom to run all the available diesel generators to compensate for plant breakdowns and maintenance failure.
What’s more, Eskom can recover only one-fifth of its diesel generation costs. So the bankrupt behemoth is literally accelerating its own death spiral by trying to pretend it has the situation under control.
To add to its woes, 20% of Eskom’s existing generation plants will reach the “end of life” by 2025. That will create an even greater (and entirely foreseeable) crisis that the South African economy will not survive unless there is drastic intervening action in the meantime.
It is hardly any wonder that many analysts conclude our electricity crisis is greater than our water crisis. After all, there are plentiful supplies of water trapped in our underground aquifers. We only have to access it, keep it pure, and then replenish it with surface water and desalination. We are now well on our way to achieving these technological feats and building a viable, resilient water economy.
There is, of course, also an unending stream of energy — in our sun, wind and water. But instead of helping us unlock it, and broaden its availability, the national government is doing everything possible to prevent us from harnessing it. And therein lies the intractability of the electricity crisis.
The truth is this: We only need four signatures (all from the same minister) to solve the energy crisis sustainably and permanently within 18 months.
The minister involved is (currently) Jeff Radebe, Minister of Energy.
For the past four years, the Western Cape government has been working on a sustainable energy plan that is ready to roll if we can get Minister Radebe’s signature on four documents.
The law sounds really complex. But the bottom line is simple. The minister must sign authorisations to enable more green energy to be generated and sold, by a greater variety of producers, and to enable municipalities to procure directly from them. That formula would solve the energy crisis permanently.
In a little more detail, the signatures required are as follows:
Signature One is needed on the revised Integrated Resource Plan (draft published in 2018). This would remove the last obstacle to the next round of bidding by independent power producers (IPPs) to supply power at an agreed price. They are waiting in the wings, as desperately as we are, for the minister’s signature to open this door.
Signature Two is needed on a letter authorising municipalities to buy electricity directly from IPPs. This would contribute to a more resilient, diverse, and decentralised electricity supply system to reduce the huge risk that comes with our complete reliance on Eskom.
Signature Three is needed on the Small-scale Embedded Generation regulations, which should define all systems up to 10MW as “distributed generation”. This would remove many regulatory barriers and encourage local entrepreneurs to undertake small-scale generation on large private roof-spaces which they would then feed into the grid.
Signature Four is needed to include Saldanha Bay as one of the ports where it will be possible, in the short term, to land liquefied natural gas. This will enable Eskom to run its diesel-fired turbines more cheaply at Ankerlig (and ideally to convert them to far more efficient combined cycle plants), and it will make natural gas available for industries in the Western Cape, replacing dirty heavy fuel oils. If South Africa is serious about re-industrialisation, then it must become serious about driving gas-based industrialisation in the Western Cape.
The documentation is ready. Signing it should be simple. I have repeatedly written to the minister and the president and have yet to receive a reply, let alone the much-needed signatures.
The reason is that the national government, and especially Minister Radebe, are still desperately trying to save Eskom. They fear that the proliferation of small independent power producers, producing electricity more cheaply than Eskom, will hasten the utility’s death spiral (which is in any event irreversible).
Minister Radebe is deluded if he believes that withholding his signatures will save the massively overstaffed, under-skilled and corruption-paralysed Eskom. In the process, it threatens to kill any prospect of a viable alternative energy economy. What we need is the go-ahead to enable local businesses and households to generate electricity (on their rooftops for example) and feed what they do not use into the grid, so that all consumers can continue to purchase electricity at an affordable price to keep the lights on and the economy running.
If these small-scale local producers are prevented from doing this, they will increasingly go “off grid”, generating only enough electricity for their own immediate needs. Those who cannot afford the infrastructure to do this will have to rely on Eskom’s increasingly expensive power.
By withholding his signatures, Minister Radebe is turning a potential win-win (for the economy and the consumer) into a lose-lose.
This is why the City of Cape Town is going to court to test whether the law does indeed require the Minister’s signature to enable municipalities to procure power from IPPs and if so, to force him to sign the necessary documentation.
Rarely was there a court case with such critical implications for economic development and job creation. That is why we will also be petitioning the court to have it moved to the urgent court roll.
It is absolutely foreseeable that Eskom’s crisis will get worse, not better. That is the bad news. The good news is that we have worked hard on a solution, which is now ready for implementation. And which could provide a model for the rest of South Africa.
Of course, the issue of job losses in Eskom and the coal industry is a matter of grave concern that must be addressed. But it cannot stand in the way of finding a solution to the energy crisis, without which the entire economy (not just Eskom and the coal industry) will collapse.
Never before has the phrase “the Minister’s billion-dollar signature” been more apt. Minister Radebe needs to use it just four times to get South Africa out of the bottomless energy hole we are in. DM
"Joyfully to the breeze royal Odysseus spread his sail and with his rudder skillfully he steered." ~ Homer