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President transfers limited powers to procure new electricity generation from Mantashe to Ramokgopa

Prior to being granted powers, Electricity Minister Dr Kgosientsho Ramokgopa did an extensive tour of Eskom's power stations

Prior to being granted powers, Electricity Minister Dr Kgosientsho Ramokgopa did an extensive tour of Eskom's power stations

26th May 2023

By: Terence Creamer

Creamer Media Editor

     

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PROCLAMATION 121 OF 2023  (1.15 MB)

Following more than two months of uncertainty and reported Cabinet infighting, President Cyril Ramaphosa has transferred Ministerial powers, albeit quite limited, relating to the procurement of new electricity generation to Electricity Minister Dr Kgosientsho Ramokgopa.

Until now Ramakgopa has had no formal Ministerial powers, despite having been appointed on March 7 and despite the President having indicated that he intended using Section 97 of the Constitution to grant such powers.

Through a proclamation communicated on May 26, the Presidency reported that Ramaphosa had transferred to the Minister of Electricity certain powers and functions entrusted by the Electricity Regulation Act, previously held by Mineral Resources and Energy Minister Gwede Mantashe.

Mantashe, who initially described the Electricity Minister as a “project manager” and who reportedly told Ramaphosa he would consider quitting if powers were taken from him, has been criticised by several commentators for failing to ensure that new generation was added at a sufficient speed and scale to reduce the risk of loadshedding, which is currently being implemented daily by Eskom.

In a statement, the Presidency reported that Ramaphosa had transferred to Ramokgopa “all powers and functions contained in Section 34(1) of the Electricity Regulation Act, which were previously entrusted to the Minister of Mineral Resources and Energy”.

The President had also transferred to the Minister of Electricity relevant powers and functions set out in Section 34(2) of the Electricity Regulation Act.

Section 34 of the Act, the statement adds, deals with new generation capacity and provides for the Minister, in consultation with the regulator, to:

  • (a) determine that new generation capacity is needed to ensure the continued uninterrupted supply of electricity;
  • (b) determine the types of energy sources from which electricity must be generated, and the percentages of electricity that must be generated from such sources;
  • (c) determine that electricity thus produced may only be sold to the persons or in the manner set out in such notice;
  • (d) determine that electricity thus produced must be purchased by the persons set out in such notice;
  • (e) require that new generation capacity must –
  • (i) be established through a tendering procedure which is fair, equitable, transparent, competitive and cost-effective; and
  • (ii) provide for private sector participation.

“This proclamation will provide the Minister of Electricity with the powers necessary to direct the procurement of new generation capacity and ensure security of supply.

“Other powers and functions contained in the Electricity Regulation Act – including those related to the implementation of determinations made in terms of section 34 – will remain with the Minister of Mineral Resources and Energy.”

LIMITED POWERS

It was not immediately clear, whether Ramokgopa had been given powers for policy development as well as for implementation, but a close reading of the Gazetted proclamation suggests that only limited powers have been extended, even on the procurement front.

The Minister does not appear to have been given an policy authority over the Integrated Resource Plan, for instance, or even authority over the IPP Office, which procures electricity on behalf of government.

His powers may actually be limited to the issuance of a determination, and Mantashe has already issued several of these, including determinations giving Eskom the right to pursue emergency and cross-border power. 

The statement adds that the President’s delineation of powers and functions is aimed at ensuring effective coordination and dedicated focus to deal more effectively and urgently with the electricity crisis.

“The Minister of Electricity will, as the President indicated in the State of the Nation Address, oversee all aspects of the electricity crisis response, including the work of the National Energy Crisis Committee.

“This will provide a single point of command for government’s efforts to close the shortfall in electricity supply.

“The Minister will work full-time with the Eskom board and management to end load-shedding and ensure that the Energy Action Plan announced by the President is implemented without delay,” the statement concludes.

Edited by Creamer Media Reporter

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