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Report blames Eskom and Government for crisis

16 July 2008 –  A reported, released this week and edited by the Centre for Development and Enterprise, lays the blame for the South African electricity crisis on Eskom and government, and calls for accountability from both.

Jacob MarogaThe report brings together the opinions of 50 government leaders and businessmen, including Eskom CEO, Jacob Maroga, who calls the energy crunch a "five- to eight-year emergency."

"We cannot assume that the current institutions, in their current form, will be able to get the job done," Maroga says in a summary of the report.

The report calls for an overhaul of the industry by opening it up to private sector participation. It also exposes the ‘real causes’ for the crisis: government’s refusal to allow Eskom to build new power stations, lack of capacity and "serious leadership failure" within Eskom and the government.

The report suggests Eskom failed when it did not do enough to persuade government to sanction new power stations, and that it put affirmative action policies above attracting and retaining skills. It also failed to extend long term supply contracts for coal and increasingly sourced supplies from inexperienced, expensive suppliers in order to comply with BEE requirements.

The report put forward priorities for securing electricity supply as follows: Short term, Eskom should increase electricity prices, "secure coal supplies and contract independent power producers, without which "the blackouts of January 2008 and the ‘load-shedding’ that followed will be just a mild foretaste of what is to come".

It also proposes, in the longer term, that an electricity portfolio be created and headed by a senior politician; that those with responsibility for the crisis resign or be fired; and that Eskom recruit badly needed skills without too much emphasis on affirmative action.