And so it came to pass that Cyril, leader of the tribes of the south, did proffer a plan to to restore light to the land, and the people thought that it was good. So deep was his thinking that he told the assembled crowds he would cast upon his office a new crisis committee, and his disciples of public enterprises, energy and trade & industry would sit thereupon.
Oh dear, President Cyril Ramaphosa’s style is to try to leave nothing to chance and crowd as much decision-making to his own office as possible. It’s a way of avoiding his cabinet, or at least the banalities of cabinet meetings. In the process he is creating a powerful presidency for himself and the rest of us are stuck with a daily political cabaret. We are mere spectators.
Still, on paper the energy plan to stop load-shedding that he announced on Monday night would stop the rot if implemented properly. That “if” hardly needs to be said. SA under the ANC is a place where nothing is ever done, where plans and promises are so thick on the ground they have practically become the ground.
Still the benefit of Ramaphosa’s latest plan is that it is broadly deregulating, which means instead of the government promising to get something done it is going to make way for the private sector to get the thing done. This begins to look like genuine reform. Lifting the cap on private sector power generation (embedded or otherwise) completely is reform on steroids.
Lifting trade, industry & competition minister Ebrahim Patel’s oppressive and obsessive local content requirements for renewable energy kit will also help, if that promise is actually kept. Here’s Ramaphosa on Monday; not a reformer here but on a wing and a prayer: “The relevant departments are working together to ensure that all projects from bid window 5 (2,600MW) of the renewable energy programme can start construction on schedule.
“This includes taking a pragmatic approach to the local content requirements for these projects, prioritising the need to build new capacity as quickly as possible. The department of trade, industry & competition, together with the independent power producers office, will provide further details in this regard within the coming days.”
Oh, really? It’s already three days later.
Pragmatic indeed. The reason he has taken longer than expected to announce this plan is because the level of “pragmatism” required to get past Patel’s compulsive loathing of all businesses is beyond polite expression. He will hold this process up, without any doubt, and the fact that Ramaphosa continues to entrust him with the re-industrialisation of our economy borders on lunacy.
It is impossible to take seriously any structure of the governing party that thinks this man is good for them or for the country. He is not, 1,000% not, a creator of jobs. Go ahead and accuse business of an “investment strike”, but no investment in its right mind would go anywhere near where Patel could shove it around the way he always does when he gets a chance.
The point is not that we should not have local content where we are competent. But to keep at bay those technologies or products (like power) that could get our industry, in our minuscule domestic market, to the point where it can export new products on the basis of quality, sophistication, price and innovation, is just too stupid to contemplate.
Bid window 5 is already behind schedule, Mr President, and worse, even though Patel may eventually have his arm twisted on local content, Russia’s invasion of Ukraine has pushed up prices so high that even with Captain Tariff out of the way not all of the renewable energy projects can reach financial close and start construction.
No-one is going to generate energy to make a loss. And the risks if the state helps out are high. If you subsidise now, what about bid window 6, which Ramaphosa on Monday announced would double in size to 5,200MW?
There is no shortage of investors for these bid windows (window 5 was four times oversubscribed, and even if Ramaphosa had quadrupled window 6 to more than 10,000MW he would still find enough interest) but there is a reasonable presumption among investors that money must be made.
The sad fact is the engineers who run coal-fired power stations, and from minister down at the department of energy, the (mainly) men in charge are old and frightened. Power station managers convinced Ramaphosa when he toured and asked that SA needs “base load”, the ability to dispatch power instantly whatever the circumstance.
We do need dispatchable power, but “base load” as we understand it is history. We are stuck with this thinking because we simply refuse to listen to the future. We already orbit a nuclear power ball so large and so hot the human race could not possibly outlive it. Nothing alive today will. Who do we think we are? All we have to do with the sun is find sustainable ways to harness it.
The arguments and debates and crises we have today are of our own making. Society needs leaders to keep it moving forward, and while Ramaphosa deserves much of the criticism and even vitriol thrown at him for rank poor leadership across our political economy when he had the chance, on Monday night he did something right. Heaven protect him from his closest ministers.
• Bruce is a former editor of Business Day and the Financial Mail.
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