DA challenges ANC metros to follow Cape Town’s lead in rejecting Eskom decision 

26 July 2016

The DA today challenges ANC metros to follow the DA-run City of Cape Town’s lead to reject the decision by Eskom CEO, Brian Molefe, to discontinue the signing of power purchase agreements with the Independent Power Produces.

Mr Molefe’s decision, which flies in the face of national Energy Policy, will have serious repercussions for the stability of electricity supply in South Africa and be yet a further hurdle to much needed job creation.

The DA is alarmed that despite abundant empirical evidence globally on the job creating potential of renewable energies Mr Molefe is preferencing nuclear energy as Eskom’s priority within South Africa’s energy mix. 

Global experience tells us that Mr Molefe’s preference for nuclear will undermine job creation in two ways, firstly by limiting expansion of the renewable sector thousands of future jobs that would have been created will now fall to the wayside; secondly, expensive nuclear energy which will drive electricity costs in South Africa to an all-time high will force many businesses to close and jobs to be destroyed. 

To stem this tide of needless job destruction DA Mayor of the City of Cape Town, Patricia De Lille, has written to the Minister of Energy requesting what is known as a Section 34 determination to allow the City of Cape Town to directly procure electricity from locally based independent power producers. This will allow the City of Cape Town to directly promote expansion of the renewable sector and in so doing boost jobs and lower electricity costs for City residents and businesses alike. 

Mr Molefe complains that Eskom no longer wants to be forced to procure energy from IPPs. On this point the DA agrees. IPPs should not be forced to sell electricity to Eskom; instead IPPs should be able to sell electricity directly to Cities, businesses and consumers via an independent grid operator. This would introduce much needed competition to Eskom and place downward pressure on electricity prices benefiting businesses and residents alike. 

The legislation to introduce an independent grid operator already exists, but still needs to be passed by Parliament. The DA will again write to the Minister of Energy demanding that the legislation be tabled in Parliament as a matter of urgency. 

Only where there is competition to Eskom and where South African Cities enjoy the power to procure electricity from the cheapest provider, will energy supply be secure, will business grow and, most importantly, will jobs be created for the millions of South Africans.

Issued by Gordon MacKay, DA Shadow Minister of Energy, 26 July 2016