Godongwana’s ‘Alice in Wonderland’ fantasies on new investments in gas and nuclear are regrettable

Issued by Kevin Mileham MP – DA Shadow Minister of Mineral Resources and Energy
01 Nov 2022 in News

Remarks by the Minister of Finance, Enoch Godongwana, that taking over a portion of Eskom’s debt will be made on the condition that the power utility agrees to invest in coal, gas and nuclear, are not only regrettable but reveals the extent of a government that has run out of ideas on how to address the energy crisis.

The only logical conclusion from this surprise announcement is that the Minister of Mineral Resources and Energy, Gwede Mantashe, has managed to “turn” Godongwana and made 240 Madiba street in Pretoria a playground to fulfill his fantasy towards a coal, gas and nuclear energy mix.

While the DA still opposes the dumping of Eskom debt on the sovereign balance sheet, we are equally opposed to harebrained attempts to foster economically unviable energy sources, like coal, gas and nuclear, into the energy mix.

Earlier this year, the DA warned that South Africa does not have access to cheap gas resources to be able to power gas stations at a commercially viable scale. Using the current import prices of gas from Mozambique, retail prices per kilowatt hour of electricity generated from these gas power stations will like be unaffordable for most South Africans.

The same goes for nuclear power in that nuclear power plants take years to build and South Africa does not have the money or the luxury of waiting that long for new generation capacity. The experience with Medupi and Khusile indicates that the ANC government is equally incapable of creating new generation capacity from coal in any reasonable timeframe, or within a reasonable budget, and without the influence of corruption and maladministration.

The DA has always made it clear that renewable energy from Independent Power Producers and distributed embedded generation are the only viable options to increase new generation capacity in the shortest possible time. The viability of renewable energy has been confirmed in successive bid windows, where the unit generation costs have continued to fall substantially.

Recently, Eskom, through the Transmission Development Plan (TDP) Public Forum, punted the importance of renewable energy when it admitted that it would need around 53GW of new additional generation capacity from renewable energy sources to ensure energy security in South Africa. The question that needs to be answered then is, why are Godongwana and Mantashe committed to derailing these viable plans in favour of coal, gas and nuclear options that would not solve the country’s immediate energy needs?

The DA will use every tool at our disposal to ensure that this “Alice in Wonderland Alliance” between Godongwana and Mantashe does not saddle South Africa with vanity projects that do not provide immediate solutions to the energy crisis. Taking over Eskom debt is a bad decision to begin but demanding that Eskom invests in new coal, gas and nuclear generation as a condition for the debt assumption, is outrageous.