Opinion / Insight Piece Article in today's Cape Times (Tue, 10th Feb, 2015)
Dear Editor
Dear Editor
“Government should create an enabling environment through the introduction of fiscal and financial support mechanisms within an appropriate legal and regulatory framework, to allow renewable energy technologies to compete with fossil-based technologies.”
This is from the ANC government's own White Paper on Renewable Energy, a Policy Paper, written in 2003.
If only they would follow their own strategy instead of blaming apartheid.
Bringing Medupi coal power station online has been delayed yet again and who can tell if this power station will ever supply electricity to the national grid?
Does the government perhaps find it easier to increase electricity prices by 25% per annum and provide grants to the poor, who will vote for them to keep their grants, than to rather increase the electricity supply which will create jobs - but then people might not vote for them?
Perhaps President Jacob Zuma, as the chief executive of the government and head of ensuring that
South African taxpayers and electricity users' monies are spent effectively - and who are funding this build - can provide us with insight as to what is meant to be completed by when and why there are delays?
Why can't the government pull out all the stops to at least get the first turbine on-stream?
We are paying for a project, which is late; is way over budget; penalties are being paid to suppliers; our bills have already been increased by 200 percent to pay for the budgeted capital spend; yet even though we are making these payments in good faith, we don't know what is happening with the power stations that Zuma and his team are building on our behalf?
And we are paying 200 percent more for a poorer state electricity supply than we had in 2008. How could this have happened?
Eskom's culture has always been to build the word's biggest, most "modern" power stations, proving how wonderful they are, but at huge expense to the taxpayer and economy.
Why has the ANC allowed this apartheid-era culture to continue when worldwide benchmarks show the there are no economies of scale of building coal power stations bigger than 800 MW? Why has the ANC allowed these two monster power stations, Medupi and Kusile, to even get off the drawing board when 12 smaller power stations would have cost the same (original budget) and would have been completed on time and without all the headaches currently being experienced by our giants?
Zuma and his team are directly responsible for the R300bn spent so far on Medupi and Kusile; plus the R12bn being spent annually on diesel; plus the loss of income of these giant power stations; plus the mega-pollution from burning this diesel; plus the money being spent on supplies which are available, but aren't being used; plus the money being spent on grants for the millions of people who would have jobs if these power stations worked. Why is our president allowing this state of affairs to continue?
Why isn't he on national TV weekly telling his electorate what he and his team have done in the past week to solve this crisis? Why isn't he in government every week doing the same thing?
The total money spent so far could have been used to make at least 6 million "township" dwellers homes into power stations. Millions of people would have jobs. And South Africa's Gini coefficient, a measure of wealthy compared to poor people, would be not be almost the world's biggest/worst.
Zuma, and last week Energy Minister Lynne Brown, blamed apartheid; and if apartheid is to blame, then I have the following observations and questions:
* In 1997, Eskom's board of directors warned the government that there would be system failures by 2008. Why didn't Zuma listen to them? Note that as far as I am concerned the ANC has been in power for 20 years and Zuma represents all his predecessors as well as himself. It's time for the blame game to stop! I'd like to read something like "we made mistakes, and this is what we are doing about it".
* In 1998 and 2003, the ANC government produced the Energy and Renewable Energy White Papers respectively. These White Papers represent the strategy and policy of the government. According to them, 30% of the national grid would be in private ownership by 2010. Why wasn't this implemented?
* In 2009, the government "implemented" Feed In Tariffs and an associated 3.5 cent per kWh levy where South African electricity users have paid over R30bn into this fund. But there are no Feed In Tariffs. In 2011, the City of Cape Town "implemented" Net Metering - and there are funds from National Government to implement this - but then the City of Cape Town prevented the Net Metering adoption. Why did the ANC prevent Feed In Tariff adoption?
Why has the DA prevented Net Metering in the Western Cape, especially when funds are available from central government to implement it, and especially when the National Energy Regulator of SA and the SA Bureau of Standards created the required Tariff Structure and Standards in 2009? Why hasn't the DA taken the ANC to court regarding the lack of implementation of Feed-In-Tariffs?
* We have read that 5.8 million more households have received electricity in the past 20 years. Is it better that those with electricity have increased from all businesses, mines, industry and 50 percent of the population (way more than the white minority) with electricity access 24 hours a day, to 86% of the population and all the job creators, who now only have intermittent access to electricity?
* Why doesn't the SA Revenue Service, South Africa's pre-eminent debt collector, get the thousands of people who have subsidised bills, but still aren't paying their bills - for example the R4bn owed by some in Soweto - to pay up?
* How has South Africa achieved the increase from 50 to 86 percent of homeowners with access to electricity over the past 20 years without building a new base load power station?
* Why is it ok for everyone to have electricity 16.5 hours a day whilst Eskom run the most expensive power stations ever designed (diesel) to support its grid? Especially when a decentralised rooftop-based grid would solve our problems, with government allowing homeowners to invest in battery-based systems before tax and before VAT, just like businesses can?
* Wouldn't it perhaps be better to use the R300bn spent on Medupi and Kusile to make 6 million formerly disadvantaged houses into power stations, meaning no electricity supply need for their owners - and I estimate that these homeowners could export an additional 20 to 50 percent surplus electricity into the grid, supplementing their income and, at the same time, ensuring that their owners continue to vote for the ANC, which has finally achieved its goal of making the poor rich by having a sustainable annuity (monthly) income?
* Why not allow the "rich", which these days seems to be anyone able to pay 100 percent of their tax, electricity, water, rates, and other government legislated bills, to build their own power stations at their own cost and for them to supply the grid with electricity at the same rate paid to Independent Power Producers (IPP's) during non-load-shedding-times and at the rate Eskom pays for diesel when needed? And this rate could reduce by 5 percent per annum!
* Brown also said in the past week that the government had expected private electricity producers to come to the table in terms of the 1998 and 2003 Energy and Renewable Energy White Papers respectively, which said that 30 percent of electricity generation should be in private ownership by 2010. But our new minister doesn't know her history! When IPSA built a 500MW coal power station in the Eastern Cape in 2006/2007, why did the government choose not to buy their electricity, forcing them to remove their power station in 2008 after years of struggling and move it overseas?
IPSA wasn't the only independent power producer affected in this way!
If the ANC's strategies mentioned above had been enabled, at least 6 million taxpayers' homes could now be power stations, or this process would be underway.
Millions more people would have jobs - building these power stations, being made into entrepreneurs by selling electricity and providing the electricity that mines, industry and business so sorely needs - finally fulfilling Karl Marx's dream of the poor working class person being able to own the means of production!
I's crazy to say that apartheid is to blame for the mess we are in when the ANC hasn't followed its own strategy, and hasn't used the information that has cost the South African taxpayer billions of rand in consultants fees wisely.
What the ANC has done is use the "excess profits" from the electricity system for other projects instead of reinvesting as they should have done, and following the wise White Papers and Policy created in 1998 and 2003. It has treated the infrastructure created by the previous regime as cash cows rather than understanding what was needed to make South Africa great.
We also read last week that the DA has finally come out against nuclear energy and is rather in favour of continuing the status quo by relying on large-scale centralised independent power producers.
How will this solve the decentralised load-shedding problems being experienced at least until 2029, according to the government's own Independent Resource Plan 2013 Update, which says that even with large-scale gas and nuclear power we can experience load shedding for the next 14 years?
I look forward to Zuma's televised and written response and Premier Helen Zille's televised and written response and, if I read that their "spokesperson" or their "special advisor" has replied, everyone will know that they still aren't listening.
Yours faithfully,
David Lipschitz
Portfolio head of energy on the Greater Cape Town Civic Alliance Exco
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