14 February 2020
The Federation of Unions of South Africa (FEDUSA) has welcomed President Cyril Ramaphosa’s announcement of concrete plans to address the crisis at Eskom during his State of the Nation Address (SONA) 2020 on Thursday night especially making sure that NERSA (the National Energy Regulator of South Africa) will process all applications by large commercial and industrial firms to generate their own uncapped electricity requirements within the statutory 120 days, whilst putting measures in place to enable municipalities in good financial standing to procure their own power from independent power producers.
While both the commercial generation of electricity by mines, industry and large retailers; on one hand and the procurement of energy by municipalities from Independent Power Producers on the other, will relieve tremendous pressure from the national grid, these need to be accompanied by a good plan to compensate Eskom for the substantial revenue incomes that will be lost as a result of these new developments.
As a member of social partners organised under Nedlac have been meeting over the last two weeks to agree on the principles of a social compact on electricity, FEDUSA welcomes the President’s formal support of the process which he expressed in the following pronouncements: “This is a historic and unprecedented development since it demonstrates the commitment of all social partners to take the necessary actions and make the necessary sacrifices to secure our energy needs; through this compact the social partners seek an efficient, productive and fit-for-purpose Eskom that generates electricity at affordable prices for communities and industries,” President Ramaphosa said.
“This requires both a drastic reduction in costs – including a review of irregular contracts – and measures to mobilize resources that will reduce Eskom’s debt and inject fresh capital where needed; the social partners – trade unions, business, community and government – are committed to mobilizing funding to address Eskom’s financial crisis in a financially sustainable manner and they would like to do this in a manner that does not put workers’ pensions at risk and that does not compromise the integrity of the financial system.
Unconditional commitment to the social compact now ultimately underpins the ability to drive with equal conviction, post SONA commitments, said FEDUSA Acting General Secretary, Riefdah Ajam. The pace and urgency of the implementation of these structural reforms will certainly ensure that meaningful expression can be realized to achieve that secure supply of reliable, affordable and, ultimately, sustainable energy, that will eliminate any notion of jeopardising worker’s pensions and lifetime savings.
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