Avoid rash Eskom decisions

HEALTHY and fair competition is fantastic news for consumers, but when it comes to Eskom the announcement by Mineral Resources and Energy Minister Gwede Mantashe at the African Mining Indaba could deliver the opposite for power generation in the country.

Mantashe on Monday told delegates that companies and municipalities could generate their own energy and spoke of a state-owned company to complement Eskom’s provision of electricity.

Eskom is R450 billion in debt and plagued with mismanagement and inefficiency. It is the biggest drain on the country’s economy.

It has arguably suffered irreparable reputational damage and if offered alternatives, companies, municipalities and consumers would discard Eskom’s services in a heartbeat. Mantashe said a second power-generating entity would address the high cost of electricity in the country.

This would also lead to a rapid decline in Eskom’s revenue and could lead to its demise. The government’s attempts to deal with the problems at Eskom may unwittingly lead to a situation where only those who can afford it will have access to private energy, while Eskom will have to hike the cost of power if it is servicing a diminishing consumer base.

For those who cannot afford the cost of “private electricity” this could prove disastrous and inequality would be exacerbated. What business and consumers require is a reliable and efficient source of power.

Rash decisions must not be taken when it comes to closing the energy gaps that exist at Eskom.