Business meets with govt and Eskom over electricity supply crisis - BUSA

Confederation says it has established a number of working groups to develop more concrete proposals on both the supply and demand side


20 January 2015

BUSA has established a bilateral working group with Government, Eskom and other stakeholders, including BUSA members and other business organisations active in the energy sector.

The working group has identified a range of actions that should be considered to alleviate the current untenable supply constraints following two meetings with Government and Eskom.

In BUSA's view there are a number of fundamental principles to be considered in addressing the current supply situation. These include:

Open, transparent and consistent communication;

Recognition that the private sector is critical in identifying and implementing a solution;

Acknowledgement that load-shedding is part of a broader series of interventions to address the challenges and that the every effort must be made to minimise the negative impact on the economy caused by load shedding.

BUSA applauds the openness with which Eskom and Government are approaching engagement with stakeholders, including business, and welcomes the intervention of Government in the establishment of a war room.

BUSA wishes to emphasize the need for consistent communication about the current supply constraints and how they will be addressed, to improve confidence at a time when all sectors of society, including the private sector, need to harness their efforts to contribute to a solution to the supply challenges being experienced.  This should take place within an agreed framework of action.

It is important to note that the support of the private sector is critical to the implementation of each of the five points in the plan:

Implementation of the maintenance plan relies on effective and efficient performance by both Eskom and original equipment manufacturers;

The immediate additional supply that could result from a range of short and medium term contracts, aside from a few municipal contracts, will come from private sector operations; additional supply is also available from a variety of co-generation projects;

The recently released proposals for an independent supply from coal-fired generation will come from the private sector;

The gas industry will require significant private sector investment to expand supply from imports;

Demand side measures are largely implemented by the private sector.

BUSA has established a number of working groups under its energy task team to develop more concrete proposals on both the supply and demand side. A working group has also been established to investigate how load-shedding can take better account of the specific challenges for different economic sectors.

BUSA acknowledges the financial constraints under which Eskom is currently operating.  Any interventions to alleviate the current situation should be evaluated, both in terms of actual cost and economic impact and the timeframe required for implementation.

It is recognised that load shedding is an intervention that must be used to protect the system in the short term.  However, a broad ranging framework of actions with implementation timeframes and costs should be developed as a matter of extreme urgency.  We look forward to working with Government, Eskom and other stakeholders on such a plan on an urgent basis.

About Business Unity South Africa:

BUSA is a confederation of business organisations including chambers of commerce and industry, professional associations, corporate associations and unisectoral organisations. It represents South African business on macro-economic and high-level issues that affect it at the national and international levels. BUSA's function is to ensure that business plays a constructive role in the country's economic growth, development and transformation and to create an environment in which businesses of all sizes and in all sectors can thrive, expand and be competitive.  

Statement issued on behalf of BUSA by Brunswick South Africa, January 20 2015

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