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South Africa

Energy will be 'flywheel' for reviving SA economy - Mantashe

───   07:00 Sun, 31 May 2020

Energy will be 'flywheel' for reviving SA economy - Mantashe | News Article
Mineral Resources and Energy Minister, Gwede Mantashe/Gallo

Energy will be the "flywheel" of reviving the South African economy which has been severely impacted by international ratings agencies downgrading the country to junk status, the economic recession, and the coronavirus (Covid-19) pandemic.


This, according to Mineral Resources and Energy Minister, Gwede Mantashe. 

The department has been engaged in continuous discussions with stakeholders in the mining and energy portfolios to ensure that collective interventions save lives and protect livelihoods, Mantashe said in a statement as millions of people prepare to return to work on Monday, June 1, when the country moves to Covid-19 alert level 3 lockdown.

"We are going through a difficult period. We are called upon to learn to live with Covid-19. We need to grow the economy while we save lives. In our view, energy will be the flywheel of reviving our economy which has been severely impacted upon by the downgrades, recession, and Covid-19, he said.

To ensure security of energy supply to society, collieries supplying Eskom continued to operate at full capacity during the higher level lockdown "During alert level 5 of the lockdown, we [also] allowed refineries to continue operating at full capacity to avoid shortage of fuel. At the time, demand had collapsed due to the closing of the economy. As a result, four refineries were closed."

With the gradual opening of the economy under alert level 4, the demand increased sharply, resulting in low stocks of diesel. It was expected that diesel would be rationed until the end of May when refineries that had been closed started producing again. The department had issued directives to provide continuous supply of energy and petroleum products by allowing maintenance and construction work for energy projects to resume under strict health and safety protocols.

These directives applied to professional entities providing licences, approvals, and authorisations for the maintenance and construction of energy projects; all professional planning, costing and design work supporting construction work on sites; contractors and consultants who needed to travel across borders to attend to projects; and energy construction work already priced and awarded government tenders, Mantashe said.

The department had published, for public comment, draft regulations amending electricity regulations to enable municipalities to develop or procure own power generation and gazetted amendments to schedule 2 of the Electricity Regulation Act, which provided clarity on requirements for generation for own use facilities of under 1MW.

It had also received concurrence from the National Energy Regulator of South Africa (Nersa) to the ministerial section 34 determination on 2000MW emergency power procurement. The department was currently working on expediting this process within the prescripts of the law.

The department awaiting concurrence from Nersa on the section 34 determination regarding generation options under the integrated resource plan (IRP) 2019. This process would enable the opening of bid windows for various sources, including coal, solar, wind, gas, and storage, he said.

Turning to mining, Mantashe said the permission for collieries supplying Eskom and oil refineries during level 5 was extended to open-cast mines under level 4. Under level 3, all deep mining operations were expected to ramp-up to full capacity, bringing the mining industry to full production capacity.

"All mining operations must prioritise the health and safety of mineworkers and other persons who may be directly affected by the operations at mines. Compliance with conditions to the starting and increasing of capacity, as enshrined in the lockdown regulations, is compulsory," he said.

Prior to ramping up, all mining operations were required to prepare and implement a mandatory code of practice for mitigating and managing Covid-19. Failure to do so would be regarded as a criminal offence and a breach of the Mine Health and Safety Act.

"We believe that the directive to all mining operations to ensure safe start-up procedures and the systematic phasing-in of workers will allow the sector to operate safely and optimally. The department continues to monitor compliance through regular unannounced and scheduled visits to mining operations. Following the unannounced visits, we discovered that not all operations are at the same level on compliance. Most of them were doing well up to screening, but lagging on testing.

"Once we made that discovery, we gave that feedback to the Minerals Council South Africa and insisted on improving on testing. Our insistence on screening and testing of all persons at mines has enabled us to detect the virus in various mining areas," Mantashe said.

As of Thursday, May 28, the mining industry had tested over 4600 persons at mines, of which 384 tested Covid-19 positive. This meant that of the 27,403 cases in South Africa, 384 were in mining.

"The more we test, the more we become aware of the extent of the problem and the location thereof. The new complication that is emerging, is people who show no signs of Covid-19 but testing positive. This tells us that we need to intensify our screening and testing programme. We urge all mining operations to pull their resources together and share testing and quarantine facilities," Mantashe said.


African News Agency


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