The political mess the minister of electricity finds himself in

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Only a month into the job as electricity minister and Kgosientsho Ramokgopa is already at odds with his counterparts over his plans for Eskom.

Ramokgopa was made electricity minister last month by President Cyril Ramaphosa to deal with load-shedding, which has brought businesses and the economy of the country to their knees.

He will work with the Eskom board to improve the utility’s energy availability factor (EAF).

Ramokgopa, who is yet to receive ministerial powers, is rumoured to be taking over some of mineral resources and energy minister Gwede Mantashe’s powers. 

Cabinet sources told Mail & Guardian that Ramaphosa is planning on transferring the whole energy department to Ramokgopa, who has been operating without a job description since his appointment.

If the rumours are true, this will strip Mantashe of his ability to make decisions on energy-related matters, and shrink his department to only look at mining-related issues.

Ramokgopa’s spokesperson, Nombulelo Nyathelo, said the minister is working with a skeleton staff alongside both Mantashe and minister of public enterprises Pravin Gordhan, under whom Eskom falls.

According to the sources in the cabinet, Mantashe received a letter from Ramaphosa to give his powers to Ramokgopa, but the letter was not well received by Mantashe who argued that his department should not be touched.

“Mantashe had no problem with Ramokgopa before this, because he was under the impression that DMRE [department of mineral resources and energy] would stay intact, taking the whole of energy out of DMRE strips the department of a large chunk of its work. All hell is bound to break loose,” the one cabinet source said.

Mantashe and Ramokgopa sing the same tune when it comes to coal and its importance to the electricity grid.

On Thursday, Ramokgopa announced that he plans to extend the life of Eskom’s power plants that were reaching their end of life by another 20 years. But this would be contingent on whether the cabinet gives him the go-ahead.

The electricity minister stressed that some difficult decisions would need to be made going into winter, as well as for the longer term. These included refurbishing the coal-fired power stations to stabilise the grid.

The fiscus had to invest in refurbishing the coal-fired power stations to improve their performance and he would advance this as his preferred option when he presented his plans to the cabinet before the end of April.

“Eskom has no money to invest in capital cost. When you accept that as a given, and say there is nothing you can do as a country, then accept that you are going to have higher levels of load-shedding, accept that the total cost to the economy continues to be exponential,” Ramokgopa said.

“Ageing power stations need investment to refurbish them to improve their performance and prolong their lifespans. This will require investment by the fiscus and/or the private sector. Renewables do not currently have enough baseload that will supply energy all day,” he said.

Cabinet sources added that there is a general discontent with Ramokgopa’s utterances which has cast doubt about South Africa’s transition of moving away from coal.

“This will have to be discussed in the next cabinet meeting because it is important that we present a unified voice, especially when dealing with international matters,” the cabinet source said.

The source added that the ANC is still dealing with “the cartel stories, now we have to explain our position to the international partner group because they don’t believe we have intentions of ever letting go of coal, let alone the carbon implications that come with that. It was a bit reckless of our comrade to utter such statements, especially before discussing it with us. It undermines comrade Cyril’s word.” 

His announcement has put him at odds with Gordhan, who has noted that his comments could jeopardise the R130 billion investment by international donors that was factored into the cabinet-approved Just Energy Transition Investment Plan (JET-IP) that envisages an investment programme of R1.5 trillion over the next five years.

Responding to questions from EFF treasurer general Mpho Maotwe in parliament on Tuesday, Gordhan contradicted Ramokgopa’s statement by saying the plan to decommission Eskom’s old plants was still on track.

“The Eskom just energy transition strategy recognises the financial prudence of investing limited capital budgets towards establishing new generating capacity from renewables, rather than investing in aged coal plants to extend their lives or to make them environmentally compliant. Many coal plants are noncompliant with national minimum emission standards requirements,” Gordhan said.

Ramokgopa said the government needs to rethink the aggressiveness of the pace at which the country is to achieve its nationally determined contributions to a net-zero level of emissions so as not to inflict harm on the economy.

Extending the ageing coal fleet is against the policy signed by Ramaphosa to replace costly coal-fired power plants with much cheaper renewable energy infrastructures. Ramokgopa plans to ask the cabinet to reconsider its position to decommission the plants  and rather extend their life expectancy.

Speaking to Mail & Guardian, energy expert Mark Swilling said if the cabinet agrees with Ramokgopa’s conclusions, this would send a signal that South Africa plans on being excluded from international markets that are introducing carbon-border taxes aimed at preventing the import of goods from carbon-intensive economies. 

Swilling added that Ramokgopa’s preferred option means disregarding cabinet-approved policies which has, in turn, triggered intense consternation among local and international investors who take a long-term view based on the certainties provided by solid cabinet-approved policy frameworks. 

“Based only on a walkabout and unsupported by the detailed technical studies that exist, we must now believe that the machines can be fixed and made to last,” Swilling said.

He added that there is plenty of funding available for renewables at a very low cost per kilowatt hour, but coal would cost the government more money while breaking the promise to limit the country’s carbon emissions.

“There is virtually no funding available for investing in coal, especially ageing, polluting, coal-fired power plants — and if there is, it will be very costly.”

Any funding is also threatened by corruption surrounding the utility which was exposed by former Eskom chief executive Andre de Ruyter, who said cabinet members were planning to loot coffers of the utility using cartels in the Mpumalanga province.

The matter is yet to be discussed in parliament when De Ruyter returns to explain the corruption uncovered at the utility.

Mandisa Nyathi is a climate reporting fellow, funded by the Open Society Foundation for South Africa.