The Path to Darkness

The following is a post written by both Darren and I. However most of the effort belongs to Darren while I couldn’t bear to let it go to waste for its concise summary of the debacle in management of this issue:

Sitting in the darkness induced by the latest Eskom blackout one can’t but help feel a growing sense of anger with the current government. One brought on by what is the latest round of its poor administration and following both a lack of ability and willingness to combat crime, shore up infrastructure and enforce discipline and accountability in so-called leaders.

Still, let’s review the chain of events that brought us here to this – excuse the pun – dark era that is finally breaking the camel’s back for many.

It begins with the government’s own commission on power requirements, which suggested in 1998 that at expected growth rates South Africa’s power surplus would be exhausted by 2007. That same commission recommended nine years ago on embarking on a construction program. It was ignored. A subsequent report was far more optimistic, but it failed to take into account that as power stations get old, they produce less power. One would think the authors of the report would have at least asked an engineer about that during the hundreds of hours it took to draft it.

Eskom was expressly forbidden from constructing new capacity, and even encouraged to export as much power to neighbouring countries as possible. The government later decided to open 30% of the local market to Independent Power Producers, but forbade any entrants from selling directly to the market. Instead, they would have had to sell to Eskom at the artificially low price that Eskom maintained, one due to both a complete lack of spending on capacity or proper maintenance and it having fired half its workforce. Predictably, no private companies bothered to respond.

Eskom, for its part, also implemented the most radical BEE and AA programme in South Africa outside of government departments, despite knowing full well that it lived and died on the (scarce) skills of its workforce. This program entailed putting in place policies to forbid the employment of any and all white males. Those skilled whites already at the company were meanwhile either outright retrenched or quietly informed that they had zero hope of promotion or advancement at the company. Unsurprisingly, most of the latter left or emigrated while some were paradoxically later rehired as consultants at more than double their prior salary.

Further, despite the fact that 90% of Eskom’s output comes from stations that require a constant supply of coal, the company canceled all previous coal contracts and replaced them with inexperienced BEE contractors. Those contractors were both underpaid for the job they were supposed to perform and did not have the skills to fulfill their obligations competently. Only a fraction of the deliveries that are contracted for are now being delivered, resulting in a massive shortage of coal at Eskom’s stations. Throughout the decade, despite knowing full well the crisis we were heading into, it chose to remain quiet lest it rock the boat. The ANC also remained silent and chose to apportion blame elsewhere when problems arose, including blaming spooks as Alec Erwin did when it came to the Koeberg shutdown.

And yet even when back in 2004 Eskom was given the go-ahead from the government to embark on a capacity construction program to build new stations the company sat on its laurels. The executives were after all more interested in generating record short term financial statement profits in order to maintain their multi-million rand bonuses, rather than in generating new capacity to maintain the country’s economic productivity.

Fast forward three years on and not a single new major power station has begun construction. None besides small gas plants are even ready to begin anytime either, with project plans far from complete.

So now we sit in a crisis, in which companies are losing millions, ordinary people are being inconvenienced in a thousand different ways a day and livelihoods are in danger. This all promises future hardship as the government, in a move all too late in the game, plans to enforce electricity quotas and smart electricity boards that’ll allow Eskom to turn off parts of our houses and businesses as it pleases. Mass retrenchments loom at the mines and enquiries at emigration agencies have spiked enormously, with predictions of an emigration wave similar to that in 1994.

Despite this demonstration of utter incompetence not a single person responsible for this mess has received anything so severe as a reprimand, let alone a sacking or resignation. We’re the ones who suffer, while those who willingly and criminally led us into this continue to enjoy their perks. They still have their expensive salaries and positions that fortify their personal security. We have darkness and an economy without power supply to 10% of its productive capacity while the outside press watches and reports on this debacle.