Sunday Times ( 27 January 2008 ) — 01/27/2008
GUILTY! FAILURE OF ENERGY SUPPLY
Marcia Klein, Bobby Jordan, Simpwe Piliso, Buddy Naidu, Lauren Cohen and Kim Hawkey
[Note by Ever-fasternews: During the last ten years of apartheid, there was a constant fear in the mining industry that sabotage by the military wing of the African National Congress could lead to massive loss of human life in the mines in South Africa, as well as cause major disruption to production and the economic basis of the industry. A power cut affecting hoists, fans, pumps, lighting and other basic functions in deep-level mining would put human life at risk as well as production. Fortunately this never happened. Last week the government of the ANC brought about the result which the mining industry most feared from sabotage by the ANC under apartheid. Five gold mining companies suspended operations for reasons of safety when Eskom, the state electricity utility company, stated that it could no longer guarantee power. The ANC government had neglected to act on warnings it received from a White Paper on future energy supply tabled in 1998, and it had persisted in misleading Parliament.]

SOUTH AFRICA'S ELECTRICITY CRISIS
(Sunday Times. 27/1/2008)

The bright sparks behind SA’s plunge into darkness...
THESE are the people to blame for plunging South Africa into darkness.
0 President Thabo Mbeki, 0 Deputy President Phumzile Mlambo-Ngcuka, 0 Public Enterprises Minister Alec Erwin and 0 former Eskom chief executive Thulani Gcabashe and his successor, Jacob Maroga, ignored the signs of impending disaster for 10 years. Not only did the government refuse to invest in new power stations in 1998, but ministers went into denial whenever they were warned. Their dereliction of duty:

0 Led to Friday’s unprecedented shutdown of the country’s mining industry at an estimated cost of R1-billion a day;
0 Sparked warnings of “radical” consequences, job losses, a dip in foreign investment and costly national projects, including 2010 construction projects, being compromised; and
0 While Mbeki and his ministers have finally apologised, not a single official has been fired or has resigned over this ‘national emergency’.

SA's biggest economic catastrophe so far
South Africa is suffering its biggest economic catastrophe so far as mining companies De Beers, Impala Platinum, Anglo Platinum, Lonmin, Northam and DRDGold shut down all or part of their operations on Friday - some confirming losses of up to R60-million a day. Last month Mbeki apologised to South Africans: 'Eskom was right and government was wrong.' Mlambo-Ngcuka apologised for the blackouts on Thursday night, but added that we 'have to suffer this pain'. On Friday Erwin said the government 'shared' the blame for the crisis. 'The president has accepted that this government got its timing wrong.' Maroga was appointed only in May last year, but had been with Eskom since 1995. He probably knew of the parastatal's earlier warning to the government that 2007 would be crunch time. He has also failed to inform the public clearly of why and how the energy crisis will affect their suburbs and industries.

Evasions and misleading statements
According to the White Paper on the Energy Policy of SA, approved by the Cabinet in 1998, Eskom warned that its surplus capacity would be fully used by 2007. The paper, signed by Penuell Maduna, who was then the Minerals and Energy Minister, advised ensuring that 'the electricity needs of the next decade are met'. But Maduna was replaced by Mlambo-Ngcuka - who insisted there was no looming crisis. In 2003 she went as far as saying she had been assured by Gcabashe that South Africa would never run out of power. Gcabashe stepped down in April last year, but remains on Eskom's payroll at the request of the board on an 18-month contract to help in its capacity-expansion programme. Shortly after the series of power failures in the Western Cape in 2005, Erwin assured Parliament that there was 'no national energy crisis'. In 2006 Erwin blamed 'sabotage' for a crisis that hit Cape Town's Koeberg nuclear power station.

The final straw
Friday's shutdown sowed panic in international markets, sending mining shares plummeting. The story is receiving coverage internationally. Harmony chief executive Graham Briggs said: 'I can’t believe it. We're losing R60-million a day and may have to make some radical decisions over the next 48 hours.' Richemont chairman Johann Rupert said it was South Africa's biggest crisis so far - the 'final straw'. He said: 'Can you imagine the impact if you start shutting mines?' The mining industry, which uses 15% of Eskom's capacity, accounts for 7% of the economy, more than 30% of exports and more than 25% of foreign exchange earnings. Other industries and sectors are on high alert. Sasol announced it would reduce electricity use 'by a meaningful amount' but warned it would affect production.

Disruption to 2010 World Cup stadium construction
The power cuts have also disrupted 2010 stadium construction, with companies splurging millions on generators. Grinaker-LTA Building area director Leon Petrie warned there would be a 'huge problem' at the stadium in Port Elizabeth, while Piet van Heerden, project manager in Polokwane, said things were 'quite bad'. Gauteng ’s Soccer City is on track but Mike Moody, project manager for Grinaker-LTA Building, said he was worried about the knock-on effect that power failures could have on cement, steel and aluminium. Chamber of Commerce and Industry economist Bill Lacey said the power crisis could have 'a drastic effect on our economic performance this year'. Business Unity South Africa chief executive Jerry Vilakazi said there was 'a huge risk of jobs being lost as many companies are working 50% of the time'.

Effects on police and prisons
In a direct threat to economic growth, Eskom is evaluating its response to new customers, new projects and expansions. The Police and Prisons Civil Rights Union's general secretary, Abbey Witbooi, said black-outs were affecting police response times and crippling prison and traffic department computer systems. Eskom has been cagey about the extent of its problems. Spokesman Carin de Villiers said one of Koeberg's two generating units would be offline for scheduled maintenance until May. The second unit, which was offline for refuelling late last year, would be fully functional soon. She said: 'The guys at the stations are working around the clock to get everything sorted out.' Eskom has 26 power stations with about five generating units each. The number of generating units down for maintenance account for 3658MW and those down for 'other reasons' account for about 5000MW. The SA Human Rights Commission said reports that the parastatal had not properly briefed emergency services, police stations and hospitals on the crisis was cause for concern. Donovan Williams of the SA National Civic Organisation said: 'We were always led to believe that our economic growth was planned and that ... electricity generation would be increased.' He said both Eskom and the government were to blame for the debacle. 'We are disappointed that Eskom has not been preaching the gospel of conservation until the crisis hit.'

Fifa monitoring the situation; 'nightmare' for hotels
Fifa general secretary Jerome Valcke said on Friday that a technical team and a soccer stadium consultant were closely monitoring the situation. Sandton's upmarket Michelangelo hotel general manager Hans Prenner said the power cuts have been 'a nightmare for an hotelier'. Prenner said a number of guests had checked out early while others are complaining or asking for discounted rates as the hotel is not supplying the service they expect. 'Our generator is limited so there are many facilities which are not available to our guests. Most are not impressed.' An additional problem is that management time is being spent fighting fires rather than managing the hotel. 'This is bad for our image and that of the country', Prenner said. Michelangelo is now planning to get in a second generator.

Effects on vehicle manufacturing
Vehicle manufacturing, the country's second-biggest industry, has yet to encounter powercuts. Toyota SA, which announced two weeks ago that it aims to increase production at its assembly plant in Durban by 41% to 205,000 units this year, has not been affected by the rolling powercuts. More than half of the assembled vehicles are destined for the export market. Spokesman Andile Dlamini yesterday said the company had not yet been affected by power cuts, as it had an arrangement with Eskom and the Durban municipality not to cut its electricity at the plant. which has recently undergone a R2.4-billion expansion. Volkswagen SA, which managed to reduce its electrical demand by about 2MW - the equivalent to saving of energy consumption of 400 houses with all appliances running - is among the car manufacturers that have not been affected. VWSA spokesman Bill Stephens said the Nelson Mandela Metro had been working around the clock to manage its grid and ensure that major industries were not affected.

0 Thabo Mbeki — Ignored an Eskom warning in 1998 that there would be a power crisis by 2007.
0 Alec Erwin — Told Parliament in 2006 that there was no national energy crisis.
0 Phumzile Mlambo- Ngcuka — Failed to tackle crisis as Energy Minister and then as Deputy President.
0 Jacob Maroga — Joined Eskom in 1995 and failed to act or raise alarm when made CEO last year.
0 Thulani Gcabashe — Former Eskom CEO knew for 10 years about looming crisis but failed to tell the public.