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Eskom energy crisis ‘engineered for looting and restructuring’

Johannesburg – The South African Federation of Trade Unions (Saftu) spokesperson Trevor Shaku came out guns blazing and has charged that the Eskom energy production crisis was engineered in order to create opportunities for looting and restructuring, which were allegedly contemplated by Public Enterprise Minister Pravin Gordhan.

“Just like SAA, Eskom’s consciously engineered woes are a premise for privatisation.”

“The eventual restructuring spells two things: job losses and higher prices. Restructuring and retrenchments have become synonymous, and this is because labour is a disposable factor of production. They will rather have fewer overworked labourers than to minimise their profits,” said Shaku.

Shaku was reacting to President Cyril Ramaphosa’s announcement this week that he has authorised a series of amendments to the Electricity Regulation Act in order to allow the IPPs to increase electricity supply to the national grid.

This means the power producers would be able to produce power without going through a long process with the energy regulator.

Ramaphosa said the IPPs would be allowed to generate up to 100 megawatts (MW) of electricity as part of dealing with the energy crisis crippling the economy and said this will relieve Eskom from the current pressure.

Shaku said the IPPs were a gradual introduction of privatised energy production and supply without having to go the traditional way of privatising Eskom because they wanted to avoid the resistance from trade unions.

“The introduction of IPPs and the subsequent reduction of Eskom’s energy supply will mean energy production and supply is dominated by private corporations whose insatiable desires to maximise profit means they will cut costs production through retrenchments and increase prices of electricity.”

On Friday, Eskom spokesperson Sikonathi Mantshantsha said it was not relevant for Eskom to answer questions about the number of jobs that would be created by the introduction of IPPs.

“Your questions about jobs to be created by IPPs must be directed to the IPPs themselves,” he retorted.

National Metal Workers of SA (Numsa) spokesperson Phakamile Hlubi-Majola said the government had embarked on introducing the IPPs because some members of the ANC were benefiting through the project.

Hlubi-Majola said the move would lead to job losses as the closure of coal-fired power stations means that 120 000 jobs would be lost in Mpumalanga.

“Government has made no social plan to replace those jobs. They haven’t done anything and they will leave it up to the private sector to work it up. “That’s what the government of the ANC always does.

“That transition is not supposed to result in thousands of job losses, and the International Labour Organisation talks about these principles. We are not following these principles at all. We allowed the private sector to come and take over and they are not going to guarantee or replace the 120 000 jobs,” she warned.

“We should not be naive and think that these IPPs had been done for the benefit of the South Africans. This is a continuation of the relationship that the ANC leadership has with capital. They are not solving the problem of load shedding, and everything that the president announced yesterday will not solve load shedding immediately.

“But I can tell you that it will benefit the cronies of the ANC who are connected to the leadership. That’s what it is about. It is about making sure that capitalism enters our state-owned entity. That’s what this ANC government, particularly under Ramaphosa, is about,” added Majola.

National Union of Metalworkers (NUM) energy sector co-ordinator Khangela Baloyi said his union viewed the IPPs renewable energy as privatisation of Eskom through the back door which would lead to job losses.

“When you do that you allow private people to produce electricity up to 100 megawatts, and take away the market of Eskom. When you take Eskom’s market share the sales will drop and that will affect the revenue of the power utility. This will lead to job losses because they will have to reduce the number of workers.”

“This is indirectly an announcement of total destruction of Eskom. Because what is going to happen is exactly what happened to SAA, Prasa and Denel. We think there is a structural way of destroying the SOEs. I remember the 1996 class project where they wanted to privatise all the SOEs and that did not succeed.

“Now the class project has come back reloaded and is succeeding, especially because most of the people that were making noise then are now quiet.”

However, Congress of South African Trade Union (Cosatu) spokesperson Sizwe Pamla said although they welcomed Ramaphosa’s announcement, it is a long-term plan which people were not looking for.

“We have been dealing with this load shedding problem since 2008 and we just couldn’t afford to stand this any further. If we have to fix the problem in whatever way we have to fix, that is our position because this is not about workers but the country’s economy that has been staggered. Many of the local businesses were shut down because of Eskom.

“We are keeping those workers but it is not helping the economy, in fact, it is increasing the cost of living,” Pamla said.

According to the United Democratic Movement leader Bantu Holomisa: “Eskom, Gordhan, Minister of Mineral Resources Gwede Mantashe and Ramaphosa must be sensitive to job losses when implementing the IPPs. We are in a difficult period because this is a transitional period from coal to renewable energy.”

“We are in fear because we are not sure how reliable this renewable energy is. And then you are going to make 300 degrees and clash with the whole institution and people lose their jobs. So a balancing act is needed and that’s what I always insist on in the presidential council on climate change.”

South Africa Community Party (SACP) member of the central committee for media and communications Alex Mashilo argued that the state should meet the socio-economic needs of the people including employment protection and new employment creation as an integral part of the transition agenda.

“One thing this means is that it is essential to raise the levels of public investment in energy production, transmission and distribution and to build a just transition including through, as a key factor, upgrading and modernising state investment in energy production, with greater attention on renewable and cleaner energy solutions,” said Mashilo.

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Sunday Independent

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