Publication: The Times Issued: Date: 2008-01-27 Reporter: Marcia Klein Reporter: Bobby Jordan Reporter: Simpwe Piliso Reporter: Buddy Naidu Reporter: Lauren Cohen Reporter: Kim Hawkey

Guilty!

 

Publication 

The Times
Date

2008-01-27
Reporter Marcia Klein
Bobby Jordan
Simpwe Piliso
Buddy Naidu
Lauren Cohen
Kim Hawkey

Web Link

www.thetimes.co.za

 

The bright sparks behind our plunge into darkness...
These are the people to blame for plunging South Africa into darkness.

President Thabo Mbeki, Deputy President Phumzile Mlambo-Ngcuka, Public Enterprises Minister Alec Erwin and former Eskom chief executive Thulani Gcabashe and his successor, Jacob Maroga, ignored the signs of impending disaster for 10 years.

Not only did the government refuse to invest in new power stations in 1998, but ministers went into denial whenever they were warned.

Their dereliction of duty:

Led to Friday's unprecedented shutdown of the country's mining industry at an estimated cost of R1-billion a day;

Sparked warnings of "radical" consequences, job losses, a dip in foreign investment and costly national projects, including 2010 construction projects, being compromised; and

While Mbeki and his ministers have finally apologised, not a single official has been fired or has resigned over this "national emergency".

South Africa is suffering its biggest economic catastrophe so far as mining companies De Beers, Impala Platinum, Anglo Platinum, Lonmin, Northam and DRDGold shut down all or part of their operations on Friday ­ some confirming losses of up to R60-million a day.

Last month Mbeki apologised to South Africans: "Eskom was right and government was wrong."

Mlambo-Ngcuka apologised for the blackouts on Thursday night, but added that we "have to suffer this pain".

On Friday Erwin said the government "shared" the blame for the crisis. "The president has accepted that this government got its timing wrong."

Maroga was appointed only in May last year but had been with Eskom since 1995. He probably knew of the parastatal's earlier warning to the government that 2007 would be crunch time. He has also failed to inform the public clearly of why and how the energy crisis will affect their suburbs and industries.

According to the White Paper on the Energy Policy of SA, approved by the Cabinet in 1998, Eskom warned that its surplus capacity would be fully used by 2007 *1. The paper, signed by Penuell Maduna, who was then the Minerals and Energy Minister, advised ensuring that "the electricity needs of the next decade are met".

But Maduna was replaced by Mlambo-Ngcuka ­ who insisted there was no looming crisis. In 2003 she went as far as saying she had been assured by Gcabashe that South Africa would never run out of power.

Gcabashe stepped down in April last year but remains on Eskom's payroll at the request of the board on an 18-month contract to help in its capacity- expansion programme.

Shortly after the series of power failures in the Western Cape in 2005, Erwin assured Parliament that there was "no national energy crisis". In 2006 Erwin blamed "sabotage" for a crisis that hit Cape Town's Koeberg nuclear power station.

Friday's shutdown sowed panic in international markets, sending mining shares plummeting. The story is receiving coverage internationally.

Harmony chief executive Graham Briggs said: "I can't believe it. We're losing R60-million a day and may have to make some radical decisions over the next 48 hours."

Richemont chairman Johann Rupert said it was South Africa's biggest crisis so far ­ the "final straw". "Can you imagine the impact if you start shutting mines?" he said.

The mining industry, which uses 15% of Eskom's capacity, accounts for 7% of the economy, more than 30% of exports and more than 25% of foreign exchange earnings.

Other industries and sectors are on high alert. Sasol announced it would reduce electricity us e "by a meaningful amount" but warned it would affect production.

The power cuts have also disrupted 2010 stadium construction , with companies splurging millions on generators.

Grinaker-LTA Building area director Leon Petrie warned there would be a "huge problem" at the stadium in Port Elizabeth , while Piet van Heerden, project manager in Polokwane, said things were "quite bad".

Gauteng's Soccer City is on track but Mike Moody, project manager for Grinaker-LTA Building, said he was worried about the knock-on effect that power failures could have on cement, steel and aluminium.

Chamber of Commerce and Industry economist Bill Lacey said the power crisis could have "a drastic effect on our economic performance this year".

Business Unity South Africa chief executive Jerry Vilakazi said there was "a huge risk of jobs being lost as many companies are working 50% of the time".

In a direct threat to economic growth, Eskom is evaluating its response to new customers, new projects and expansions.

The Police and Prisons Civil Rights Union's general secretary, Abbey Witbooi, said black- outs were affecting police response times and crippling prison and traffic department computer systems.

Eskom has been cagey about the extent of its problems. Spokesman Carin de Villiers said one of Koeberg's two generating units would be offline for scheduled maintenance until May. The second unit, which was offline for refuelling late last year, would be fully functional soon.

She said: " The guys at the stations are working around the clock to get everything sorted out."

Eskom has 26 power stations with about five generating units each. The number of generating units down for maintenance account for 3658MW and those down for "other reasons" account for about 5000MW.

The SA Human Rights Commission said reports that the parastatal had not properly briefed emergency services, police stations and hospitals on the crisis was cause for concern.

Donovan Williams of the SA National Civic Organisation said: "We were always led to believe that our economic growth was planned and that ... electricity generation would be increased."

He said both Eskom and the government were to blame for the debacle. "We are disappointed that Eskom has not been preaching the gospel of conservation until the crisis hit."

Fifa general secretary Jérôme Valcke said on Friday that a technical team and a soccer stadium consultant were closely monitoring the situation.

Sandton's upmarket Michelangelo hotel general manager Hans Prenner said the power cuts have been "a nightmare for an hotelier".

"Our generator is limited so there are many facilities which are not available to our guests. Most are not impressed."

Prenner said a number of guests had checked out early while others are complaining or asking for discounted rates as the hotel is not supplying the service they expect.

An additional problem is that management time is being spent fighting fires rather than managing the hotel.

"This is bad for our image and that of the country", Prenner said. Michelangelo is now planning to get in a second generator.

Vehicle manufacturing, the country's second-biggest industry, has yet to encounter powercuts.

Toyota SA, which announced two weeks ago that it aims to increase production at its assembly plant in Durban by 41% to 205 000 units this year, has not been affected by the rolling powercuts.

More than half of the assembled vehicles are destined for the export market.

Spokesman Andile Dlamini yesterday said the company had not yet been affected by power cuts, as it had an arrangement with Eskom and the Durban municipality not to cut its electricity at the plant. which has recently undergone a R2.4-billion expansion.

Volkswagen SA, which managed to reduce its electrical demand by about 2MW ­ the equivalent to saving of energy consumption of 400 houses with all appliances running ­ is among the car manufacturers that have not been affected.

VWSA spokesman Bill Stephens said the Nelson Mandela Metro had been working around the clock to manage its grid and ensure that major industries were not affected.

Additional reporting by Kim Hawkey and Lauren Cohen

With acknowledgements to Marcia Klein, Bobby Jordan, Simpwe Piliso, Buddy Naidu, Lauren Cohen, Kim Hawkey and The Times.


*1       Yet the Government and Eskom allowed :
This is fully in the face of years' worth of dire warnings of upcoming power shortages.

This is negligence and reckless of a genuine criminal nature.

Charge them.