South Africa: New Eskom CEO Asked To Start Work Early

Cabinet has mandated Public Enterprises Minister Pravin Gordhan to negotiate with incoming Eskom CEO Andre de Ruyter to start his role earlier than the set date of January 2020.

Addressing the media after the final Cabinet meeting for 2019, Jackson Mthembu who is a Minister at the Presidency, said de Ruyter and the Eskom management team would be expected to “immediately deal with the concerning issues of governance, lack of financial management as well as stabilise the operations of Eskom.” 

“This includes dealing with the huge backlog of maintenance of the ageing fleet of their power stations and the structural defects in Medupi and Kusile power stations,” he added.

This request comes on the back of Eskom implementing stage 6 load shedding.

Mthembu added that Deputy President David Mabuza would convene a resuscitated Energy War Room comprising Finance Minister Tito Mboweni, Minerals and Energy Minister Gwede Mantashe and Minister Gordhan to “deal with any challenges to our energy supply in the country”.

The final Cabinet statement noted that “renewables will play a key role in our energy supply to complement the efforts of Eskom.”

Cabinet also approved the Biofuels Regulatory Framework, which will give effect to the implementation of the Biofuels Industrial Strategy. 

The framework provides for five areas to be regulated: 

1. The Feedstock Protocol. The protocol mitigates the risk of the biofuels programme towards food security;
2. the mandatory blending regulations so as to create certainty of biofuels demand;
3. the cost recovery mechanism for blending of biofuels;
4. the Biofuels subsidy mechanism for biofuels farmer support and biofuel manufacturer’s support; and
5. the selection criteria for biofuel projects requiring a subsidy. 

Cabinet has also approved the publication of the draft Upstream Petroleum Resources Development Bill for public comment. 

The Bill seeks to create an environment that will promote investment into the upstream petroleum sector. It provides guidance on the exploration and production activities that will contribute to economic growth and transformation. The Bill separately provides for the regulation of petroleum resources. It establishes the Petroleum Agency of South Africa, which will make recommendations to the Minister of Mineral Resources and Energy.