ESG

Miners back Eskom leaders amid deepening power crisis in SA

South Africa’s peak mining body has voiced support for leaders of the embattled, state-owned power utility Eskom, but called for measures including emergency tax incentives to help miners address the power crisis.

 Two employees at Eskom’s Tutuka power station were arrested for alleged fraud, theft and corruption last week

Two employees at Eskom’s Tutuka power station were arrested for alleged fraud, theft and corruption last week

The country has experienced "significant" stage four load shedding, or scheduled power outages, over the past two weeks as Eskom struggled to keep the lights on.

The National Union of Mineworkers this week called for Eskom's leadership to resign, saying the government needed to declare the situation a national crisis.

Fellow trade union, the National Union of Metalworkers of South Africa, has echoed the call, saying it was time for Eskom CEO André de Ruyter and COO Jan Oberholzer to be removed.

However the Minerals Council South Africa said yesterday a change of leadership would be "a complete disaster for Eskom".

"They need time to fix the assets and they need shortened, efficient and sensible procurement processes," CEO Roger Baxter said.

The minerals council said it was "gravely concerned about the deepening crisis around electricity supply", which not only negatively affected the mining industry but the entire economy at a time when energy security was critical to attract investment, for economic growth and job creation to stabilise government debt and reduce the fiscal deficit.

It urged the government to consider emergency tax incentives and other "smart-tape measures" to encourage private-sector investment in energy generation, saying council members currently had 1.6GW of renewable energy projects valued about R30 billion they wanted to progress.

Eskom faces a multitude of issues, including ageing infrastructure, critically low diesel availability, theft and vandalism.

Eskom said two of its Tutuka power station employees were arrested last week, as was a supplier, with all three facing charges of fraud, theft and corruption "in a crime in which hundreds of millions of rands in goods and services have been paid by Eskom when such have not been delivered or rendered at the power station".

It said more arrests were expected in another fuel oil crime syndicate.

Miners were hobbled when load shedding escalated to the unprecedented level of stage six in December 2019 and they could be further impacted by a forecast increase in outages in the coming years.

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