Well actually that’s not true, especially if one looks at ESKOMS recent misdeeds behaviour. ESKOM does what it wants, when it wants. ESKOM executives choose to focus more on bonuses and just in time coal stock piles and less on the countries well being.

Now ESKOM (with the collusion of NERSA) are hiding what is referred to as “commercially sensitive” details of ESKOMS application for a 53% tariff increase from the public. ESKOM is a public company nothing about its financials should be hidden from its owners.

I would encourage South Africans to fax their complaints to NERSA on (012) 401-4700.

Goolam Ballim, Chief Economist at Standard Bank succintly states the problem we will be faced with should ESKOM’s massive hike be allowed:

There’s going to be multiple effects. Firstly, it is going to raise the general level of inflation in the country, because clearly electricity is a core input into production, not just into consumption in terms of residential living. So it will raise the cost of living and within the broad basket of staple items.

What Minister of Minerals and Energy Buyelwe Sonjica claimed she said:

“I was presenting a 12-minute speech and that speech did not say ‘go to bed, go to bed, go to bed’,” said Sonjica, adding that Democratic Alliance politician Leon heckled her, asking what happened when the lights were turned off.

“I was chastising Tony Leon, and I said to him ‘You go to bed, you are stupid, go to bed and then you will grow and become cleverer.’

“It was not directed at South Africans.”

What she actually said:

“Hon members, I want to conclude by introducing these tips – a 10-point plan that will go towards changing our behaviour in the consumption of electricity. “All appliances must be switched off … [interjections] … at the wall, and not the remote control. We can save about 40MW there. Switch off all lights in the home when not in use and go to sleep early so that you can grow … [laughter] … and be cleverer. — Hansard

This isn’t her brightest hour. Perhaps what the good minister really needs is a bit more sleep?

Government preaches about the Batho Pele principles; Batho Pele says that government will strive to create a better life for all South Africans by putting people first.

Clearly the people were not placed first which is why we find ourselves in this mess. Yes it is a mess. It’s a mess in the biggest possible way. We as the citizenry need to be able to trust that our public structures and institutions will always do what’s in our best interest, even if it means giving us bad news before the crisis hits so that we can make plans to deal with it.

For some inexplicable reason between 1998 and 2008 government and Eskom decided to hide the fact that we were headed for this crisis. In March 2006 the President responded to a parliamentary question by saying “The Honourable Member is proceeding from the wrong assumption that our government has failed to meet South Africa‘s electricity capacity needs.”

Less than two years later we are experiencing on an almost daily basis just how wrong or ill informed the President was.

I have every confidence that South Africa will pull out of this crisis quickly. ESKOM – despite this embarrassment and its spineless executives – is a world class electricity company, government now has the urgency to deliver and the money is available. We will survive and I’m sure the South African economy will prosper once again.

However in the face of short term economic woes we are jokingly being advised by the Minister of Minerals and Energy to “Go to sleep earlier so that you can grow and be cleverer”. Clearly the Minister – Energy issues is part of her portfolio – and her colleagues were going to sleep too early and this is how we have landed in this mess. The country faces the real prospect of an economic slow down which could result in large scale job losses.

What is unfortunate about this whole mess is that this crisis has given more cannon fodder for racists fools try to back up their arguments. The internet is littered with racist drivel about how this crisis proves that black people cannot govern a country or run large corporations. Grant Walliser counters this nicely “White people need to understand that black executives at Eskom warned the government about the impending power crisis. One of the key people who didn’t listen was white. Why is this still a racial issue?”

This is not a race issue this is an ineptitude issue. Heads should roll; there is no collective responsibility on this one. We should be looking at solutions and cleaning house at the same time. Obviously we cannot trust the same people who got us into this mess in the first place to get us out of this mess.

What’s that joke again? Oh yes “will someone please turn the light off at the end of the tunnel”.

“When Eskom said to the government: ‘We think we must invest more in terms of electricity generation’, we said no, but all you will be doing is just to build excess capacity,”

This according to President Thabo Mbeki, is the why the country is currently experiencing its rolling power outages. Government had so little faith in ESKOM’s intentions that they would not allow ESKOM to build additional capacity. Clearly there was a disconnect between Government economists chanting the 4% growth mantra and the engineers who needed to supply the lifeblood of the economy – electricity.

This is yet another example of the disjointed manner in which planning is done in the public sector.

But money is not the only thing Eskom will be pumping. South Africa by all accounts has one of the cheapest electricity generation industries in the world. One of the reasons for this is because our electricity demand is met through the burning of coal. We are blessed with an abundance of coal in the North of the country. Coal however is the most polluting way to generate electricity.

Eskom has just been award second place by CARMA (Carbon Monitoring for Action) on its list of most polluting power companies in the world. Eskom is dumping ~214,000,000 tons of CO2 into the atmosphere every year through burning as much fossil fuel. So coal is our saviour and our villain.

Obviously no country can afford to just stop its current methods for generating electricity. In South Africa the need for more power is not only being driven by the growing economy i.e. current users – residential and industrial – requiring more power, but also by more and more households connecting to the electricity grid for the first time; thanks to governments policies aimed at poverty alleviation and access to basic services.

Eskom and the South African government are currently investigating alternatives. Nuclear is being punted as one of these alternatives. The South African government is also looking at bio fuels systems, hybrid systems, hydro systems, solar energy systems; and wind energy systems as other alternatives. However it would seem that the view of the Department of Minerals and Energy is that these alternatives are suitable exclusively in South Africa’s rural areas.

To date programmes with a strong rural focus have not been implemented as successfully as they could be. Energy is a highly technical area requiring private sector buy in and investment. To date government has not been able to channel this buy in and investments successfully into rural areas just examine how successful the Integrated Sustainable Renewal Programme (ISRDP) has been at getting private sector action – not commitments– in the rural nodes.

Focusing on just one potential alterative, here is a video presentation given by venture capitalist Vinod Khosla on how Solar can be made a financially viable alternative to coal. What’s interesting about this presentation is how he pitches the economic viability of Solar.

You can download the slides as well.There is a lot of great and exciting work being done by entrepreneurs, governments, scientist and NGO’s worldwide to think up better ways to maximise renewal sources of energy. I like Khosla’s thrust that there is amble resource around us to power humanities needs, we must not underestimate our ingenuity.

[slideshare id=174495&doc=eskom-annual-report-20062007-1195643965742586-4&w=425]

The data for that article was sourced from the National Energy Regulator of South Africa’s public hearing on electricity prices which was held in Durban on 20 November 2007, where an Umgeni Water representative reported that the proposed hike in electricity tariffs would cause subsequent rise in water prices as well. He noted that electricity is one of the primary drivers in the process of purifying water; therefore the rise in electricity prices will necessitate an increase in water prices.

While there is unlikely to be single South African citizen at this point in time who is unaware that we have a problem with electricity supply and the need to conserve energy, given the rolling black outs that have become a way of life of late. Arbitrary, blanket increases are not the solution. We need to find a way to deal with poor long term planning of resources, poor spatial planning in urban areas, wastage etc. These are planning issues that need to be affected properly with a long term view and understanding of the impact it has on all other aspects of government and public functioning. It needs to be communicated well to the public and partnered with the public to find a resolution. Crisis functioning is the reason we have a problem in the first place. Punishing citizens with price increasing merely exacerbated the problem, as citizens believe that they are being forced to compensate for inept government functions.

Electricity and water are scarce resources in South Africa and many South Africa citizens still have no access to these resources or are unable to afford them at current prices. Providing services to all citizens has been a challenge for municipalities and has been the reason a Free Basic Service (FBS) policy has been championed by government. To ensure that all citizens can have access to services, as is their constitutional right. An increase in the cost of both electricity and water, will impact hardest on the poor, who are already unable to pay for these services and will impact on the ability of government to roll out the FBS programme. It will add a further financial burden to municipalities who at present are struggling to manage their functions in a fiscally responsible way and are forced to subsidise the costs of vast numbers of their constituency instead of relying on service delivery as a municipal income. This burden on municipalities will then have to be relieved by the national fiscus.