Energy Crisis: Will the President see the light?

Issued by Ghaleb Cachalia MP & Kevin Mileham MP –
13 Jul 2022 in News

Please find attached soundbite by Ghaleb Cachalia MP.

The DA cautiously welcomes reports that President Cyril Ramaphosa is about to declare an energy emergency to respond to the electricity crisis. At the bare minimum, we expect a plan with key deliverables and set timelines that will have a clear roadmap of when new generation capacity will be brought online.

South Africans have been taken for a ride over the years with Eskom turnaround plans that have dismally failed to end the loadshedding crisis. This time around, the DA stands ready to hold government’s feet to the fire and ensure that all the stakeholders involved in implementing the energy response plan are held accountable.

As part of efforts to ensure that implementation of the energy emergency plan remains on track and is accountable to South Africans, the DA will propose the establishment of an ad-hoc parliamentary committee. Parliament should play a central role in enforcing accountability and sustained implementation of project deliverables.

While the President’s anticipated announcement has taken longer than necessary, considering the devastating impact that loadshedding is having on the economy and livelihoods, we are encouraged that, exactly 63 days since we asked Cabinet to promulgate an Electricity Emergency Response Plan to respond to the electricity crisis, action is now being taken.

The DA strongly believes that any energy emergency declaration must be ring-fenced around the electricity value chain, from generation, distribution and transmission.

In the short term, South Africa needs to secure the amount of power made available by Eskom’s fleet of power plants to meet the minimum demands by consumers, in addition to opening up – with speed – alternative sources of supply to meet the nation’s requirements. We would encourage and support any and all augmentation – internal and external – to generation on a source-agnostic and lowest-cost basis. As such, the DA believes the energy emergency declaration should:

  • At the bare minimum, allow for a waiver or moratorium to be placed on stringent regulations that are preventing Eskom from pursuing an accelerated on-boarding of generation capacity potential from Independent Power Producers (IPPs) projects;
  • Place a mandatory requirement on all approved IPP projects to provide quarterly updates on progress made;
  • Lessen or remove the costly regulatory burden which is standing in the way of self-generation, especially at household level and in discrete industry environments;
  • Compel National Energy Regulator of South Africa (NERSA) to conduct its regulatory approach within an emergency frame to help lessen red tape and approve generation projects in shorter timelines;
  • Ensure budget reprioritization of resources from non-emergency expenditure items towards accelerated spending in energy generation projects;
  • Review, with urgency onerous preferential procurement policies and less than optimally productive cadre staff deployments to assist with proper reliability maintenance of the existing fleet.

The underlying premise of the DA’s call for a state of disaster on Eskom and the electricity sector is that, in view of the dire state of the country’s electricity generation capacity, South Africa should be making it easy, not difficult, for IPPs to bring new power at scale and in the shortest possible time. To this end, an energy declaration should:

  • Help to place a moratorium on localization requirements for renewable energy projects as a way of reducing costs for renewable energy projects;
  • Facilitate the opening up of transmission and infrastructure investment to public-private partnerships in order to expedite the integration of upcoming planned generation capacity;
  • Require that the Department of Energy provides full transparency on its internal standard operating procedure to ensure that the requests for Section 34 Determinations by municipalities are attended to in the shortest possible time;
  • Make it easy for small-scale embedded generation (SSEG) to become a critical component of the overall electricity generation mix by through the provision of an incentive-driven tariff system for SSEGs that allows municipalities to compensate customers for excess electricity fed back onto their electricity grid and lessens the regulatory burden on consumers who install such systems.

The DA looks forward to having the energy emergency declaration tabled in Parliament as a matter of urgency so that we can begin the process of freeing South Africans from the shackles of loadshedding.