re posted from HUGO KRUGER SUBSTACK
Conversations with Eskom
Understanding the electricity crisis
I am currently continuing with my series on Eskom and the electricity supply problem in South Africa. Eventually I will give a writeup on the solution, but briefly my sense is that South Africans are too quick to blame corruption as the only cause for Eskom’s Woes. That is not to say that State Capture didn’t occur or that André DeRuyter wasn’t wrong that “you cannot steal the sun”, but the issue is much broader and in my view and comes downs to a lack of institutional knowledge, political interference and engineers not being in charge of the utility. In addition South Africa set unrealistic emissions reductions goals at international forums that we couldn’t possible meet.
I personally also put a lot of blame on the policy framework that in my view encourages underperformance and amounts to systemic sabotage. The Eskom that worked before NERSA came into being, following the 1998 white paper on privatization was entirely different than the Eskom that came afterwards. Engineers systematically lost control over the key decision making and revenue collection and as is always with political interference, the least qualified and least knowledgeable people rose to the top.
The policies amount in my view to what was imposed on Russia in the 1990s by the clever “Harvard Boys”, but South Africa didn’t take the advice of shady Bill Clinton advisors, rather we did it to ourselves.
Eskom can be fixed within a short period of time, 18months to 3 years if the government appoints competent people and focuses on adding capacity to the grid, there is no need for a dogmatic debate between private or public ownership, its simply about fixing what works.
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