Tag: Eskom

“Having put load shedding behind us…” These were the confident words of President Cyril Ramaphosa at this year’s State of the Nation Address. He declared load shedding a thing of the past. He repeated this claim twice. Not even the official end of the COVID-19 pandemic carried the same level of certainty. That crisis almost pushed our economy to the brink of collapse.

Two Gauteng residential developments, 304 On Main in Ferndale and Kierland Skye in Benoni, have turned their backs on Eskom power. They are now saving tens of thousands of rand each month while ensuring uninterrupted electricity for hundreds of residents in each complex.

At the end of January, the National Energy Regulator of South Africa (NERSA) announced that Eskom can implement tariff increases of 12.7%, 5.36% and 6.19% over the next three financial years. This decision represents a significant downward adjustment from the 36.14%, 11.81% and 9.10% increases that Eskom originally requested.

Austerity does not need to mean suffering. Cutting public spending is urgent to address South Africa’s growing debt. Delaying cuts will only worsen debt and interest payments, making future cuts more severe. Reducing spending needn’t harm South Africans, as many wasteful expenses can be removed. In 2023, the Democratic Alliance (DA) estimated that the African National Congress (ANC)-led departments wasted around R40 billion in 2022/23 alone.

While South Africa has enjoyed an extended respite from load shedding this year, there are other compelling reasons to accelerate the transition to renewable energy. One of the reasons are that businesses and homeowners are concerned about Eskom’s reported intention of seeking a 36% increase in tariffs in 2025 - on the back of electricity prices that have roughly tripled over the past 14 years.

The formation of South Africa’s new Government of National Unity (GNU) bodes well for the consolidation of state reform and pro-growth initiatives, including better performing parastatals, such as Eskom and Transnet. Given that economic growth is essential to spur social development, I believe now is the time to act.

In 2023, Reuel Khoza unsealed a letter to the future, which he had written in 1999 when he was chair of Eskom, at the time recognised as the best power utility in the world. It was an optimistic letter, expressing hopes that have since been dashed by corruption and maladministration – by a failure of ethical leadership.

South Africa is experiencing a monumental uptick in its renewable energy sector, driven by a number of factors including rapid expansion, increased investment, and the rising need for homes and businesses to reduce their reliance on the national power grid. This burgeoning industry, however, faces a formidable challenge: a critical shortage of skilled labour.

As South Africa’s energy sector continues to evolve, understanding the changes in regulations, contracts, and market dynamics is crucial. The restructuring of South Africa’s regulatory framework, especially within the energy sector is critical given the present crisis the country is in. Unbundling, where different parts of the energy sector are separated, amounts to far more than just paperwork.

Eskom has run a successful pilot of virtual wheeling, which will enable companies with multiple offtake sites to connect to generators using the Eskom or municipal grids. Electricity wheeling mechanisms play a key role in facilitating the optimal integration of renewable energy resources into the grid.