South African business' official energy champion, Jayendra Naidoo, said at the weekend that he is prioritising the creation of an outcomes-oriented partnership with government that could, among other issues, provide impetus to a plan to deliver 5 000 MW worth of short-term power relief for the country's supply-stressed national grid.

Speaking following a Business Leadership South Africa (BLSA) board meeting in Parktown, Johannesburg, which had focused on South Africa's prevailing electricity challenges, Naidoo stressed that the electricity crisis was not a "side issue", but the "main issue" confronting business and society as a whole.

Naidoo has also been appointed energy champion for the country's representative business organisation, Business Unity South Africa (Busa) and not only BLSA, which comprises 50 of South Africa's leading listed companies, as well as 30 others, including multinationals and State-owned enterprises.

South Africa's reserve margin was chronically low, at between 5% and 8%, and was likely to remain constrained in spite of Eskom's R460-billion-plus build programme, which was deemed insufficient to restore the targeted reserve margin of between 15% and 19%.

"There is little question that there is a need both for more power between now and 2030, as well as a better use of the power we have," Naidoo said, stressing that there was also a need to restore efficiencies at Eskom, which would continue to occupy a central position within the country electricity milieu for many years.

The 5 000-MW offer, which was presented to Energy Minister Dipuo Peters at a Busa meeting in April, comprised savings and new supply options, covering renewable energy, cogeneration and conventional power production, dubbed "own production" by the Energy Intensive User Group members pursuing such developments.

It has been estimated that South Africa will have to double its current generation capacity by 2030, to around 80 000 MW, to keep pace with economic and social demand, and business is urging government to allow the private sector to play a larger role in financing, building and operating this new capacity.

At a meeting in April, Peters reiterated government's desire for the private sector to develop 30% of that capacity. However, there were still material regulatory and policy impediments to a large-scale entry by the private sector, including:

• A lack of clarity on power purchase agreement guidelines;
• Uncertainty about the role of government in guaranteeing new private capacity;
• No stated policy on the level of crossborder importation that would be allowed; and
• Uncertainty on the nature of the buying entity, with government having signalled that an independent systems and market operator would replace Eskom as the single buyer.

Naidoo said that the solution lay in an alliance of government, business and labour reaching an urgent resolution on ways to overcome the current impediments.

He added that it was critical for some resolution to be reached "well before the end of the year".

ENERGY & PLANNING

BLSA chairperson Bobby Godsell, who was named by President Jacob Zuma on Friday as a member of The Presidency's newly formed National Planning Commission (NPC), said that any dialogue on the electricity crisis should be shaped by two values: keeping the lights on, and ensuring a power mix that was affordable to business and citizens.

He refused to be drawn on how he intended to give impetus to the electricity issue within the NPC, saying it would be "presumptuous" to speak about his role before the commission had even met.

However, he stressed that he was "very much looking forward" to participating in a body that would had the opportunity of crafting a vision for South Africa, both economically and socially, for the next 25 years.

He noted, too, that the horizon of the NPC was aligned to the work being done by BLSA on developing a vision for the doubling, or trebling of the South African economy over the next 20 years to 30 years.

CEO Michael Spicer reported that BLSA's project to enter into a dialogue with business people on the success factors and constraints to their business development over the past 16 years of democracy was gathering impetus.

He also dismissed recent media reports suggesting that BLSA was unhappy with the level of government-to-business engagement, which he described as a "misstatement of the situation".

"At some levels, we have never been closer [to government]," Spicer said, but added that BLSA and other business organisations were keen to clarify the model of future "collective" consultation with government.

Godsell argued that these dialogues should be "more than a photo op" and should probably take place "more than once a year".