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Earlier in April amaBhungane and Just Share authored a column criticising the lack of transparency between business and government in their engagements - affecting climate policy. James Mackay, CEO of the Energy Council, responds to that column, indicating that business has been working with government to solve the energy crisis and details of these engagements are accessible.
Read the original piece here.
- For climate change news and analysis, go to News24 Climate Future.
South Africans are rightly concerned about the poor state of our economy. Years of corruption, poor policy, collapsing service delivery, a lack of state capacity to deliver and load shedding have stymied economic growth, and led to increasing unemployment levels.
This is unacceptable and having a highly detrimental impact on our economy and society, so it is understandable that promises for a swift end to our energy crisis through decisive action, although welcomed, may seem rather unrealistic.
Despite this backdrop, I feel that we have actually turned the corner. Having been integrally involved in National Energy Crisis Committee (NECOM) workstreams and immersed in the energy industry, I can attest to the fact that significant and rapid progress – albeit off a very low base, is being made.
Business for South Africa (B4SA) has brought together the best of corporate sector expertise to set up a truly unique partnership for delivery with the government to improve performance across the energy, transport and logistics sectors as well as support efforts to tackle crime and corruption for the betterment of all South Africans.
The Energy Council of South Africa has been coordinating these efforts to tackle improvements in the energy sector. We have over 34 direct corporate members and have mobilised experts to spend over 4 000 hours working with the NECOM to engage our Eskom and government counterparts.
Our focus has been on addressing critical technical challenges, ranging from power station performance analysis, to grid access, wheeling (which allows independent power producers to sell directly to consumers via the grid) and regulatory improvements. While there's still a long way to go, it is encouraging that we are really starting to see the payoff of these significant collective efforts and very transparent performance discussions.
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It has been recognised that we need to do a better job communicating these successes and plans. The detail of our work is readily available as the Energy Council provides open access to recordings of all meetings of all business stakeholders engaging NECOM as well as hosts monthly update meetings on all workstream activities.
We've invited civil society advocacy groups to access this information and are available to answer any questions they may have.
The Energy Council's primary purpose is to support a thriving energy sector through an optimal national energy transition. We are clear that we must achieve our commitments under the United Nations Framework Convention on Climate Change (UNFCCC) Paris Agreement and our pending climate legislation.
Our multi-decade energy transition journey, however, will be complex and challenging. As we decarbonise our economy, we must protect energy security, ensure we provide affordable energy to all, and mobilise a R1.5 trillion direct capital investment programme over the next 10 years.
The opportunities for job creation and new businesses are massive, but so is the possible fallout – particularly for those in sunset industries who still play pivotal societal roles. This is a tough and complex balancing act that requires trade-offs all over. Indeed, if any one sector or industry or societal group puts its interests above others, we will not achieve the pace required to stay within planetary boundaries.
It would however be naïve to think that all stakeholders are equally positioned and have equal resources to respond to this challenge and so it will take maturity and lots of dialogue to progress.
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What we can celebrate is that we've collectively made real progress over the last 12 months. Specifically, load shedding hours have dropped by two-thirds compared to this time last year (when there were deep concerns about system failure). Eskom is working hard on the power station turnaround plan and although reliability remains low, significant maintenance backlogs have been addressed.
These are multi-year turnaround plans, not quick fixes. Given the makeup of our economy and energy mix, we will be dependent on coal generation for decades to come. This means we need to continue to support these recovery efforts. In the meantime, we have seen a rapid mobilisation of private sector investment into renewable energy deployment approaching R80 billion per year. This is creating jobs, new start-ups and putting money back into the economy.
Accelerated public auctions for further renewables, battery storage and gas to power have been released, further stimulating development and investment. From being "dead and buried" for years, our energy sector's primary reform has come bursting out of the blocks.
The Electricity Regulation Amendment (ERA) Bill (which provides the legislative framework to implement the President's Energy Action Plan and associated market reforms) remains on track.
The unbundling of Eskom is proceeding well with the new National Transmission Company being established. Market preparation for a competitive electricity market is proceeding rapidly. Overall, through the B4SA partnership and Energy Council efforts, there is new momentum backed by good governance and robust debate.
I would like to reaffirm the Energy Council's commitment to transparent and robust engagement with all public, private and civil society stakeholders.
We need a capable and engaged state to deliver an economic recovery and a successful energy transition. The government will have to redefine many of its roles as it pivots to a rapidly changing landscape where energy investment is market-led and the government supports and accelerates the modernisation of the sector and the expanding role of private providers.
This is an exciting time full of opportunitywith the potential for South Africa to become a global role model as an emerging market player that successfully implements a just energy transition. I have every confidence that together, we can make it happen.
James Mackay is CEO of the Energy Council of South Africa.
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