28 October 2008
On Thursday the 30th of October 2008, Earthlife Africa Johannesburg and the Anti-Privatisation Forum will be marching on the Department of Minerals & Energy, Eskom, and the City of Johannesburg. Communities across Gauteng are protesting to demand a decent, meaningful Free Basic Allocation of electricity and for increased generation of electricity from renewable resources.
The march will start at 9:30am at Beyers Naude Square/Library Gardens (Market and Rissik Street, Johannesburg CBD), it will then proceed to Eskom and the Department of Mineral and Energy in Braamfontein. The march will end at the Johannesburg Civic Centre.
The issues at hand are pressing for poor communities and the wider nation at large.
Many poor households remain unconnected to the electricity grid, or unable to afford electricity entirely, leading them instead to use fuel-wood, coal, and paraffin as their primary energy carriers. Many others suffer varying frequencies of disconnection due to their inability to afford the entire amount charged for electricity, although most are able to pay at least some on a regular basis.
Poor households who are connected to the grid spend a staggering proportion of their income on electricity relative to more wealthy consumers. The poorest 20% of households spend about 5% of their average R500 a month income on electricity, when they remain connected, compared to the richest 20%, who pay about 1.6% of their average R30 000 per month income. This is despite the fact that the poorest quintile uses about 1/40th the amount of electricity as the richest quintile. Combined with the constant threat of disconnection, affordability of access will only become a greater problem as Eskom seeks to raise tariffs to fund its new investment programme.
South Africa's poor already suffer from an epidemic of disconnection due to inability to pay tariffs prior to 2007/2008 tariff increases: Despite the Government and Eskom's repeated boasts about electrification, 30% of South Africans are still without electricity. Of the 70% who do have electricity, many poor users suffer from disconnection. The independent researcher David McDonald has calculated that there were two million disconnections by 2002. Furthermore, users of prepaid meters disconnect themselves (due to lack of funds to feed the meter), thus transferring the onus of disconnection from the state to the citizenry. Currently, prepaid users pay more for electricity than any other user of electricity outside of deep, rural areas. The poor pay the most per kilowatt-hour; people in Sandton pay less per unit than people in Soweto.
Currently, DME's Draft Electricity Pricing Policy is heading towards Parliament. This Policy was mean higher electricity prices, greater deregulation in the electricity sector, no meaningful investment in renewable technologies, and an insulting and paltry free allocation of 50kWh per household. This is less than certain municipalities are currently offering, and takes no regard to the size of households. With eight people in a household, 50kWh wouldn't last a week.
Furthermore, this "free" electricity will be means-tested (with huge administration costs), require the installation of a prepaid meter, and will be limited to a 20A connection, instead of the normal 60A connection. This means that poor users may be able to heat water but not cook or vice versa. This is completely inadequate and will only prolong the misery of millions of poor South Africans.
The Policy also makes for no meaningful investment in renewable technologies, which will be, in the next decades, cheaper options than coal: The latest research into pricing of electricity in the South African context clearly demonstrates the superiority of renewables. The current cost of generating electricity from new coal-fired stations (such as Medupi) is R0.25/kWh, set to rise to R0.36/kWh by 2020. The cost of solar thermal is currently at R0.40/kWh, and is set to decline to R0.25/kwh by 2020. The cost of wind is presently R0.49/kWh and will fall to R0.29/kWh in 2020. Solar thermal technology can provide base-load power, making it a viable alternative to coal, and there is no real limit to its usage in South Africa.
Please note that the costs for coal cited above exclude the externalised costs of burning coal; i.e. the costs of health and environmental damage from SOX and NOX emissions. This would double the economic costs. These figures also exclude recent commodity price increases; they are the most conservative fossil fuel costs available.
Oddly enough, DME's Electricity Policy directly contradicts the Long-Term Mitigation Scenarios (approved in June 2008) that calls for 50% of all electricity to come from renewable resources by 2050. Eskom is also ignoring this policy with its building of new coal-fired power stations.
The Anti-Privatisation Forum and Earthlife Africa Johannesburg therefore demand:
1. A free basic allocation of 100kWh per person per month, and with a corresponding step-block tariff. The People's Budget Campaign has consistently called for these.
2. The end of the prepaid metering system.
3. Massive investment in renewable technologies. We do not see nuclear power as a safe, cost-effective alternative to coal, and no nuclear plants should be built in South Africa.
4. The DME should withdraw its Draft Electricity Pricing Policy in its entirety. A progressive policy should be written with a humane basic allocation of electricity as its starting point, not the maximisation of Eskom profits, which stood at nearly R1 billion last year.
For more information, please contact:
Energy Policy Officer
Earthlife Africa-Johannesburg Branch
Tel: +27 11 339 3662
Fax: +27 11 339 3270
Cell: +27 84 250 2434
Anti Privatisation Forum
Tel: + 27 11 333 8334
Fax: +27 11 333 8335
Cell: +27 72 173 7268