BEPA’S REACTION TO PRESIDENT CYRIL RAMAPHOSA’S PRONOUNCEMENTS ON PROGRESS REGARDING ECONOMIC RECONSTRUCTION AND RECOVERY DURING THE PLENARY OF THE NATIONAL ASSEMBLY ON 03 SEPTEMBER 2021

 

The Black Energy Professionals Association (BEPA) broadly welcomes the replies to questions by the President of the Republic of South Africa during the National Assembly Plenary of 03 September 2021.

President Ramaphosa addressed many of the contemporary political and socio-economic themes as raised by members of the National Assembly, and of particular interest to BEPA, outlined progress with the implementation of the various interventions contained in the Economic Reconstruction and Recovery Plan. This plan was adopted as a response to the long-standing socio-economic challenges of South Africa, but triggered by the devastating impact of the COVID-19 pandemic on lives and livelihoods across South Africa. BEPA recognizes the progress reported by the President as well as the challenges encountered in the process of implementing the interventions in the plan. The recent unrest in Gauteng and KwaZulu-Natal have made implementation more pressing and BEPA contends that the overall safety and security response needs to be undergirded by more urgent socio-economic measures, as acknowledged by the President. Efforts at social cohesion and unity, as reported on by the President, are also welcomed by BEPA as these enhance local and national stability.

The energy sector is dependent on social stability and relies heavily on economic growth. The destruction of infrastructure, in this regard, affects energy distribution and the cost of energy significantly. In light of what President Ramaphosa said during his address, BEPA supports all efforts to bring stability to the country and prevent the wanton destruction of businesses and infrastructure, the lifeblood and backbone of economic activity respectively. These acts have also disrupted supply chains on which many industries rely, including the energy sector.

As President Ramaphosa stressed during the session, infrastructure planning, spend and delivery will be accelerated on a massive scale. BEPA is of the view that much more needs to be done to capacitate the state to deliver on infrastructure commitments and in so doing it can draw from the talented pool of black professionals across the various spectrums of infrastructure development. It can and should take the form of partnerships with emerging and established private sector organisations where much of this expertise is located.

Accelerating efforts to ensure energy security as mentioned by the President, is supported by BEPA. However, BEPA would caution against piecemeal reactions to energy security challenges that emerge from time to time through loadshedding, as it may lead to further systems instability. The careful planning and sequencing of the pace and scale of energy reforms to address the issue of energy security should not lead to a constant reliance on expedient solutions, which could have negative longer-term ramifications. The move to renewable energy is a necessary one, but one that needs to be managed carefully within the context of systems stability, and within the context of the supposed “just energy transition.”

The President cited as progress in energy sector reform the lifting of the embedded generation threshold to 100 Megawatt. He neglected to provide more detail on what this will entail and that other regulatory challenges persist that need to be dealt with to enable the investment in embedded generation to be actualised.

Although the President made some remarks on the requirement to restructure state-owned entities, he did not take the opportunity to reflect on the challenges and opportunities that this could unlock. In the context of the crisis with regards to SoEs and Eskom in particular, this was an issue the President should have addressed. On the local government front, the President’s statement that crucial attention is being paid to addressing the outstanding debt of municipalities to Eskom should be met with broad accord, given Eskom’s dire financial straits.

BEPA supports all efforts to deal with unemployment, to support small businesses across the board, and particularly black-owned businesses that have been affected by both the COVId-19 pandemic and recent civil strife, gender-sensitive support measures, measures targeted at addressing youth unemployment and more importantly, efforts at energy sector reform and transformation that open opportunities for black businesses and professionals to participate meaningfully in the energy value chain spanning all sources of energy.

BEPA further welcomes and supports the President’s pronouncements on the health interventions to mitigate the effects of the COVID-19 pandemic. These interventions should be embraced across the energy sector as it pertains to workplace health and safety.

However, the President and members of parliament through their questions missed an opportunity to address the nation on detailed progress with the economic recovery plan – including energy security and transformation – instead making broad statements that there is overall progress and that more measures to deal with unemployment will be announced. The sense of urgency to deal with economic growth and unemployment therefore seemed lost on the President and members of parliament, and BEPA would like to encourage that a greater sense of urgency be espoused and more detail be provided on the front of economic recovery whenever the opportunity arises.

Source: Opinion piece prepared on behalf of BEPA by Ricardo Hansby, Executive Director of Senzenina Economic & Enterprise Development Solutions (Pty) Ltd.