Energy Council of South Africa CEO James Mackay has dismissed suggestions that the suspension of load-shedding for more than a month now is due to political pressure and the upcoming elections.
“It’s not a conspiracy theory. We are having, I think, a combination of good work coming together. Yes, the system remains unreliable... Certainly, there is an element of goodwill, things like addressing tube failures and the like that make a big contribution. But at the end of the day, this is not political pressure and electioneering. It’s a genuine move along this pathway that has been well-defined.”
Mackay was giving an update on the partnership between government and business to address key challenges in energy supply, transport, logistics, and the fight against crime and corruption.
He said the economy was in a mess when the government and business decided to finally get together and tackle some of the most pressing problems.
In the 18 months before the partnership was launched there were “the KZN riots, failing port and rail, rampant load-shedding, and we then had the sort of [former Eskom group CEO] André de Ruyter exposé, and then we were put on the FATF [Financial Action Task Force] greylist”.
“So, I think at that stage, it was really very evident that we had to do something different if we were going to turn around the economy for all South Africans. So it wasn’t a political intervention at all... I think it is very clear that the partnership has grown in strength, and it’s built on the mobilisation of resources to get things done.”
On Monday, electricity minister Kgosientsho Ramokgopa denied claims that Eskom was avoiding load-shedding by burning higher volumes of diesel, as alleged by De Ruyter. South Africa had gone 40 days without load-shedding at the time.
Mackay said 2024 and 2025 would see significant growth in the utility-scale of power generation thanks to more rooftop solar energy usage.
“These are all now in play and are starting to produce and get megawatts into the system. Renewable energy, particularly wind and solar ... saw huge growth in 2023 — 2,600MW put onto rooftop solar. Completely unexpected and, I think, far beyond what anyone predicted.”
Last year, a group of leading CEOs signed a pledge to assist the government with challenges that impeded South Africa’s economic growth. CEOs representing more than 115 companies agreed to address load-shedding, logistics constraints and crime and corruption.
The head of the project management office in the Presidency, Rudi Dicks, said through Eskom’s generation recovery plan the government was able to focus on reducing unplanned losses, allowing load-shedding to be suspended for an extended period.
“We are in the process of finalising our mutual collaboration agreement with the business colleagues on providing resources and additional skills. Already, some of that has been deployed to some of the power stations and that continues to be a conversation around specifically designed interventions.”
It is clear that we are now getting real traction. In the case of energy, we’ve seen a 60% reduction in load-shedding year-on-year
— Chair of the B4SA steering committee, Martin Kingston
Dicks said the government was seeing significant momentum and traction in its energy interventions after President Cyril Ramaphosa called for more impactful partnerships and collaboration between the government and business.
“On the auction programme, and particularly the IPP [independent power producer] programme, there’s a slight delay but we want to ensure the success of bid window 7. We do not want to go into the similar route that had happened with bid window 6, where there were constraints of grid availability.”
The IPP office in the department of energy said bid window 3 of the battery energy storage IPP procurement programme would be extended by three months to the end of October as the government plans to procure 616MW in battery storage.
He said since the National Energy Crisis Committee was launched after the president’s announcement of the Energy Action Plan in July 2022, there was an improvement in the performance of the power stations and some additional megawatts from rooftop solar.
Changes to schedule 2 of the Electricity Regulation Act are currently in parliament and will formalise the procedures by which energy can be produced and traded in South Africa. This will come in as the National Transmission Company of South Africa manages the wheeling regime and trading market.
The chair of the B4SA steering committee, Martin Kingston, said business and government held a strategic meeting last week focusing on platforms of government, electricity, transport logistics challenges, as well as crime and corruption.
“It is clear that we are now getting real traction. In the case of energy, we’ve seen a 60% reduction in load-shedding year-on-year and 80% when we talk about stages 4 and above, in part, due to enhanced performance.
“In transport and logistics, we have seen a material turnaround in the waiting times for vessels. We have seen, in terms of financing, very substantial financial relief is being put in place at Transnet through the National Treasury.
“Across all three of these areas, we’ve mobilised about 350 resources, technical expertise, both on the business side as well as human resource mobilisation, which is capacitating government ... and then finally, in the case of crime and corruption, [there has been] a material though not adequate, reduction of security incidents on the coal line.”
Companies that signed the pledge to support the government interventions include BP, Naspers, Vodacom, Remgro, Toyota, PwC, Sibanye-Stillwater, Anglo-American and Massmart. Signatories are estimated to have a combined 1.2-million employees in sectors such as health care, mining, banking and telecommunications.
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