Big business’ official power-crisis intermediary has called for a new ‘compact’ between business, Eskom and government to deal with immediate power imbalance threats, but has also raised misgivings about making the proposed energy conservation scheme (ECS) mandatory, labelling it as “load shedding by another name”.

Nevertheless, J&J Group’s executive chairperson Jayendra Naidoo, who is also Business Leadership South Africa’s point person on electricity, acknowledged on Tuesday that, in the absence of “extraordinary efforts” to deal with the shortfall, the ECS could emerge as the only way to close the gap.

The Department of Energy (DoE) presented the ECS, which proposes 10% mandatory savings by energy intensive businesses against a 2006 consumption baseline, to the National Economic Development and Labour Council late last year.

However, both the DoE and Eskom, which is a proponent of the scheme, want it approved, but not immediately activated. Activation, they say, should only take place as a “last resort” safeguard should the power imbalance become acute ahead of the introduction of new capacity from late 2012 onwards.

Eskom is forecasting a supply/demand gap of between 6TWh and 9TWh during 2011 and 2012, over and above savings that should be achieved from demand reduction and efficiency projects. It says that 9TWh is equivalent to the yearly consumption of a city such as Cape Town.

The State-owned utility was also engaging with energy-intensive businesses to stimulate own- and co-generation projects, and is in the process of appointing a demand ‘aggregator’ to buy back power from smaller commercial consumers.

But Naidoo told delegates to the 2011 Energy Indaba, in Sandton, that the ECS, if implemented, could have negative consequences for investment, growth and employment creation.

He said it was necessary to explore alternatives to closing the gaps, which could also require that government scale up its incentives to stimulate demand reduction efforts within commerce, industry, mining and even at the residential level.

“We will try our best, as business, to avoid an outcome that is negative for growth, investment and jobs,” Naidoo said, adding that he was “looking forward” to the engagements that would take place on the matter in the coming weeks.

“But at this stage, the ECS looks like a form of load shedding by a different name,” he cautioned.