ANC wants to establish second power parastatal to challenge first, failed power parastatal (Eskom)

President Cyril Ramaphosa says the ANC is considering establishing a second state-owned power utility to compete against the struggling Eskom.

Ramaphosa made the announcement on Friday, at the South African Communist Party’s (SACP) 15th national congress in Boksburg, east of Johannesburg.

The president said the proposal for a second power utility was made by Energy and Mineral Resources Minister Gwede Mantashe, when Eskom implemented stage 6 load shedding.

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Ramaphosa said he agreed with Mantashe’s proposal as this would reduce the risk posed by Eskom’s generation capacity challenges to the economy.

“I said I agree with him because the state must continue to play a key role, but I’ll come back to that,” he said.

Eskom’s monopoly

Ramaphosa said Eskom had been in distress for the past 15 years and operating according to a model that was no longer suited to the technology or the economic conditions of the present future.

He said the second state-owned power utility would, therefore, challenge Eskom’s monopoly.

“For the past 100 years, Eskom has operated as a monopoly [and] a single company responsible for the electricity generation, transmission and distribution… if it [Eskom] fails; it becomes a spectacular calamity for the entire country.

“That is the risk that we have [and] if we look at other countries like China, for instance, it has a number of state-owned electricity generation companies that even compete among themselves to even bring prices down. And that is the future I think we should begin to imagine,” Ramaphosa said.

The president also slammed critics who accused government of setting up state-owned entities for failure in order to sell them to the private sector.

Ramaphosa said this was a lie.

“We are not through restructuring seeking to privatise [and] in fact we are trying to modernise and ensure that the state continues to play its role in ensuring that these state-owned enterprises function well.”

Energy emergency plan

The president was expected to announce an energy emergency plan for South Africa as part of a “comprehensive set of actions” aimed at solving the ongoing load shedding.

He said this announcement would be made in the coming days.

“We will be announcing additional measures we need to take to adddress the current electricity crisis by coming up with new ideas of bringing new generation capacity online,” Ramaphosa said.

Since June, South Africans have been without electricity for hours a day, with Eskom’s load shedding schedule bouncing between the various stages of power cuts.

Eskom announced that it would continue with the rolling blackouts until Thursday next week.

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