National Disaster: South Africa to Appoint Minister of Electricity - Africa’s premier report on the oil, gas and energy landscape.

National Disaster: South Africa to Appoint Minister of Electricity

South Africa has classified its electricity supply challenge as a national disaster.

President Ramaphosa declares that a Gazette classifying the severe electricity supply constraint a national disaster has been published by the Department of Co-operative Governance prior to his speech.

Ramaphosa announced, in his State of the Nation Address (SONA) on February 9, 2023, that he would be appointing a new Minister of Electricity in The Presidency “to assume full responsibility for overseeing all aspects of the electricity crisis response.”

“The Minister would focus full-time on ending loadshedding and ensuring that the Energy Action Plan announced in July last year (2022) “was implemented without delay””, the President said, his seventh, since he took power in 2018.

South Africa has suffered, since January 2022 to date, its most severe power cuts since 2008. The crippling power outages have led to a decline in mineral production across all commodities. It is estimated that load shedding costs the economy about $60Million,” says Gwede Mantashe, the country’s Minister of Energy.

Estimates from the South African Reserve Bank (SARB) are that the country loses around 50Million a day at stage 6. The central bank has cut the country’s GDP growth prospects for 2023 to a paltry 0.3% in 2023 on the basis that blackouts have cut two percentage points of growth from the economy.

“At the centre of our current energy challenges is the decline in the energy availability factor from an estimated 75% to 49%”, Mantashe told a Mining Conference in Cape Town in the first week of February 2023.

President Ramaphosa said in the SONA that country’s Auditor-General, would be brought in to ensure “continuous monitoring of expenditure in order to guard against any abuses of funds needed to attend to this disaster”.

The disaster declaration would enable government to implement practical measures needed to support businesses in the food production, storage and retail supply chain, including for the roll-out of generators, solar panels and uninterrupted power supply.

“Where technically possible”, Ramaphosa said, “it will enable us to exempt critical infrastructure such as hospitals and water treatment plants from load shedding. “And it will enable us to accelerate energy projects and limit regulatory requirements while maintaining rigorous environmental protections, procurement principles and technical standards.”

Ramaphosa noted that shareholder responsibility for the state owned power utility, Eskom, would remain with the Public Enterprises Minister and would not be shifted to the Mineral Resources and Energy Minister.

“The Minister of Public Enterprises will remain the shareholder representative of Eskom and steer the restructuring of Eskom, ensure the establishment of the transmission company, oversee the implementation of the just energy transition programme, and oversee the establishment of the SOE Holding Company.”

 

 

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