ALARMING accounts of several crime syndicates operating within Eskom have arrived on the heels of similar findings made by the Zondo ‘Commission of Inquiry into Allegations of State Capture, Corruption and Fraud in the Public Sector including Organs of State’. Judge Raymond Zondo’s investigation is outlined in Volume 4, and two parts, aptly named Eskom 1 and Eskom 2.
The content should not simply regale the public with shenanigans surrounding the appointment of the 2014 board, the manner in which Brian Molefe and Mr Anoj Singh acted to assist the Gupta’s and ultimately former president Jacob Zuma, to unlawfully benefit from various Eskom contracts. Rather it should have lead to earnest self-reflection, mass action and debate within our Parliament.
Unfortunately, our daily press failed to report on the Zondo Commission Report in a manner befitting the gravity of the commission and the seriousness of its findings. One would have expected pages and pages, not simply columns narrating the facts in both chapter and verse to the public, alongside screaming headlines that characterised the 1977 Muldergate and Information Scandal which implicated then Prime Minister, B. J. Vorster.
The reduction of our paper-thin media to mere summarisation alongside anecdotal reporting and casual opinion, — where details and facts get lost under bullets and straplines, buzzwords and talk-points that essentially lead nowhere — is a minor tragedy of our age. The newsrooms which broke the Muldergate and Information Scandal are long gone. In their stead are paid sycophants, centralised editorial and lowered credibility.
It was only a matter of time before the bubble of public credulousness generated in this manner, would burst. All it took was for Eskom CEO André de Ruyter to spill the beans in a national television interview. Despite attempts by political commissars and conspiracy theorists on the ground to spin this story into a mere ‘tale of privatisation by stealth’, and worse, ‘right-wing posturing’, de Ruyter hit back with a damning Affidavit implicating the ruling party, and backed up by sworn statements by Eskom employees.
I encourage readers to listen to the audio below, in which a Daily Maverick journo refers to the cartels and a ‘territorial ruler’ currently under investigation.
SO LONG as this country myopically persists with it’s strange obsession in maintaining the Eskom energy monopoly, there will be load-shedding and blackouts. Consumers desperately require choices in energy provider, options on who can connect their home grid, to power the toaster and microwave oven. But practically nobody here is speaking out on the lack of consumer choice when it comes to electricity.
Its as if energy analysts are brainwashed morons flogging the proverbial dead horse, each year they call for inquiries into why the horse died, reclassifying the dead horse as ‘living impaired’, arrange for officials to visit other countries to ‘see how they ride dead horses’, call for additional funding and training to ‘improve the dead horse’s performance’, or the hiring of outside contractors to ‘ride the dead horse’, and so on, but are simply too afraid to ‘let go of the horse’, lest they be out of a job.
What is wrong with you people?
A decade ago I attended a talk by David Lipshitz, founder and CEO of MyPowerStation. A company which aims to provide a ‘virtual power station’ solution via online billing and provisioning of energy services to consumers. His magnificent idea of introducing information technology to the sale of electricity to the end-user and consumer, has been stymied by a regulatory environment which is more in keeping with a 19th Century model of distribution than the 21st century.
“What would happen if city dwellers in cities with more than 1 million people suddenly had no electricity?” asks Lipshitz in an ‘electrifying, shocking, and powerful thriller’, that is too close for comfort. The past week has seen some areas of South Africa experiencing 9 hour blackouts. The weekend was a series of 6 hours of load-shedding for my own household.
South Africa’s model of energy distribution requires urgent and drastic intervention. And I don’t mean to re-engage the debate on where our electricity should be coming from in other words, how it is produced. Doing so merely adds to the pile of doggy-doo dolled up by consultants, analysts and self-proclaimed experts dished up on national television on a daily basis.
Whether or not, electricity is provided by the state, or Independent Power Producers (IPPs) is of no real consequence in a system in which the end-user is placed at the forefront. There are no rational reasons why consumers should not be given the choice of purchasing energy from sustainable resources, whether women-owned utilities, or listed companies with a high ESG and BEE component. Let the people decide.
Eskom is heavily in debt and clearly unprofitable when it comes to the generation of electricity, and is a prime example of why governments and bureaucrats are less efficient than the market and free enterprise when it comes to allocation of capital. Which is why we continue to see the introduction of tariff increases several times over the inflation rate. Is more money really going to solve the problem?
Not when we have the bizarre situation in which our Muni’s and Metro’s, alongside the corner Cafe ‘prepaid token’ store, are all added to the game of profiting off the bulk sale of electricity, energy provided by a grossly inefficient pyramid scheme by a solitary, underperforming producer of electricity. Nobody is fooled by people like Cape Town mayor Geordin Hill-Lewis promising the City will bring new capacity online, give or take a megawatt, or our President Ramaphosa, racing home to declare yet another electricity crisis requiring a crisis committee.
Without actioning on our rights as consumers, rights enshrined in our constitution, we will be left in the dark. It is essential for Eskom to open up the grid, not only to the ‘wheeling of electricity’ but to the dealing and virtualisation of billing and provisioning of new services. Then we might take a cue from New Zealand where deregulation has proven incredibly successful.
The country has 5 major electricity generating companies. Genesis Energy, Mercury and Meridian Energy operate under a ‘mixed ownership model’ in which the government holds a majority stake, while Contact and Trustpower are private sector companies. The country once struggled with a system very similar to our own, before dumping a socialist government.
Sadly, despite promises, there appears to be no genuine enabling legislation nor incentives in South Africa to allow a third party to purchase electricity, from either the state or the IPPs, and to resell the result on the open, rather than captive market, to the consumer. This is clearly why our system is failing. Embracing Lipshitz’s modest proposal and learning from the example of New Zealand, would be a step in the right direction.
In fact one does not have far to travel, to examine the case of another state monopoly, to see why deregulation when it comes to South Africa is the only solution. The fate of Telkom, once the country’s sole cable monopoly, provides us with a good case in point. If we had not opened up, we would still have a situation in which the only telephone available, was from the same company, with a single color, beige. Left to its own devices (excuse the pun) Telkom would still be in the copper age.
Look at how Internet Services Providers (ISPs), just like IPPs began to emerge in the 90s, while our government to its credit allowed a semblance of competition (initially only in the mobile market). With the result these companies grew up and essentially outflanked Grandma Telkom. In the process provisioning fibre cable infrastructure to the suburbs, and FTTH, all of which cost the taxpayer not a single penny.
Given enough time, our IPPs might eventually begin rolling out similar infrastructure. In fact they would be negligent if they did not. Best to get Eskom into open competition mode as soon as possible. The alternative is living with a permanent threat of massive grid failure just around the corner, alongside a collapsed economy.