Opposition party Democratic Alliance (DA) interim leader John Steenhuisen on Friday slammed the idea of another State-owned power generation company, calling it a “mad, bad idea”.

He went on to say companies needing permission from government to be self-reliant had been “crazy”.

Mineral Resources and Energy Minister Gwede Mantashe announced at the Investing in African Mining Indaba this week that mining companies were now allowed to generate their own electricity, in the face of Eskom’s electricity generation challenges.

Steenhuisen said South Africa needed an open and competitive energy market, to allow energy producers to generate and sell to anyone who wants to buy it and at whatever price is agreed on.

“There are plenty of independent power producers in South Africa who are ready and willing to generate electricity, thereby diversifying our energy mix, and making it more reliable and cheaper. Open, competitive markets should be the norm in our society,” he said.

The DA interim leader also pointed to the party’s recent draft policy document, launched by the party’s head of policy Gwen Ngwenya, which provided clear guidelines on how to better achieve the best energy mix.

Steenhuisen said the party’s policy document is the basis for a new set of rules for South Africa, one that would lead to an open-opportunity society for all.

“It envisages a social market economy in which participants – businesses and consumers rather than government – decide on what to purchase, where to invest, and how much to produce,” he explained.

Steenhuisen also called for public feedback on the party’s policy document via its online portal.

Structural Reforms

Meanwhile, Steenhuisen went on to emphasise the need to establish sound structural reforms, concurring with the recent warning from Finance Minister Tito Mboweni, who said if the country could not effect deep economic reforms, it would be “game over”.

“South Africa urgently needs another “reset”. We need sweeping structural reforms – a radical change to the ‘rules of the game’,” Steenhuisen stressed.

Looking to South Africa’s prospective credit rating downgrade to junk status by Moody’s, Steenhuisen said more tough conditions will further cripple our economy.

He warned this would raise the cost of future borrowing and accelerate the country’s economic decline and said it was up to Ramaphosa to effect change.

“On Thursday, February 13, he will deliver his third State of the Nation Address. This is his Rubicon moment. He can continue to choose dithering over decisiveness and keep playing by the current rules of the game – in which government plays an ever-greater role in the economy and “transformation” is achieved by BEE, EE, EWC and political patronage – or he can change the rules of the game to unleash private enterprise and entrepreneurship,” Steenhuisen stated.

He said the current rules were failing South Africa unequivocally and dangerously, as inequality and poverty were both growing.