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The Eskom factor:
Power politics and
the electricity sector
in South Africa
Report 2012
Based on the research report: The Electricity Governance Complex.
Michael Koen of the Civil Society Research and Support Collective. 2012
For more information contact: iafrica@greenpeace.org
Based on the research report: The Electricity Governance Complex.
Michael Koen of the Civil Society Research and Support Collective. 2012
Acknowledgements: Melita Steele, Nina Schulz, Fiona Musana, Michael Baillie
Edited by: Melita Steele, Nina Schulz and Fiona Musana
Published in June, 2012
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Cover inner: ©Greenpeace/Oswald Chikosi, 2011
Back cover: ©Greenpeace/Benedicte Kurzen, 2011
1. Introduction 3
2. Historical, political and economic influence of Eskom 5
2.1. Early Electricity Provision 5
2.2. The Minerals-Energy Complex 5
2.3. The “Corporatisation” of Eskom 6
2.4. The Post-Apartheid Transition period 1990-1994 7
3. Influence and accommodation: Eskom and Government
Policy 1994-2001 9
4. Commercialisation of Eskom: 2001-2012 11
5. Eskom and Water 12
6. Conclusion 13
2 The Eskom factor: Power politics and the electricity sector in South Africa
1. Introduction
Eskom Holdings Limited (ESCOM) is a household name need to reduce the coal content of the electricity generation
in South Africa, and has a long and influential history in the mix in South Africa. However, only a tiny proportion of Eskom’s
country, and on the African continent. Established in 1923 as electricity portfolio is currently contributing to this fundamental
the Electricity Supply Commission ‘ESCOM’, the state-owned solution that Eskom CEO Brian Dames refers to.
utility1 is responsible for generating, transmitting and distributing
electricity to industrial, mining, commercial, agricultural and Of the utility’s 237,000 GWh total generation, the electricity
residential customers. In essence, Eskom has an effective output from wind was only 2 GWh in 2010.8 Initially a
monopoly in the electricity sector, which also places a commitment was made to reduce coal reliance by 10% by
tremendous amount of responsibility in the utility’s hands. 2012 at the 2002 World Summit on Sustainable Development
(WSSD).9 Instead, coal intensity has increased.
Eskom has undergone some major changes from its origins
in 1923: the utility has seen periods of almost complete
autonomy, greater regulation, an oversupply crisis, rolling
Carbon Dioxide (CO2) emissions
Eskom is almost entirely reliant on coal. As a result,
blackouts, and massive electricity price hikes. The result is that
according to the Carbon Monitoring for Action (CARMA)
in 2012 the utility is almost entirely dependent on coal2,
database, in 2007 the utility was the second largest
remains most responsive to mining and large corporate
power utility emitter of CO2 globally.10 11
interests due to its central mandate of ‘driving economic
development’3, and continues to invest in large-scale,
centralised electricity generation. However, the country Eskom states that it is necessary to double total capacity to
simultaneously faces a host of major development challenges, around 80,000 MW by 2025 to keep the lights on in South
exacerbated by the legacy and structures of apartheid. Africa.12 In reality, the vast majority of this capacity will be used
These include a dramatic gap between rich and poor, lack of by industry and will remain coal-based. Some 9,000 MW of
infrastructure, high levels of urbanisation and unemployment, this will be provided by two of the world’s largest coal-fired
extreme inequality and poverty, and huge backlogs in service power stations (Kusile and Medupi), both currently under
delivery to the majority of South Africans.4 construction. However, the decision to invest in more coal has
significant implications.
But what is the real story behind Eskom’s decisions? This
document seeks to outline Eskom’s role in South Africa, By building Medupi and Kusile power stations, Eskom
its evolution as a state-owned company, and its current and the South African government have committed to
status as a key player in South African politics. significantly increasing South Africa’s annual emissions and
contribution to climate change, combined with substantial
The investment recommendations and decisions made by health, coal mining and water use impacts.13 Kusile alone
Eskom are particularly important, with wide-ranging impacts will generate an estimated 37 million tonnes of carbon dioxide
for all South Africans. The utility has publicly acknowledged (CO2) equivalent emissions annually, increasing the country’s
the potentially negative impacts of climate change5 and the total contribution to climate change by an immense 10%.14
Eskom facts and figures6
Eskom can quite rightly be described as a giant:
• Ranked in the top 10 utilities in the world in terms of generation and sales;
• Has 27 (including one nuclear) operational power stations;
• Generates about 95% of the electricity used in South Africa, and over 40% of all electricity consumed in Africa;
• Mining alone used 14.3% of Eskom’s supply by 2011; and
• In 2011 had a net maximum capacity of 41,194 MW.7
1
Eskom is a State Owned Enterprise (SOE). In its current form this means it is a commercialised entity incorporated with the Government of South Africa (GOSA) as its sole
shareholder represented by the Department of Public Enterprises. The board is therefore accountable to public finance legislation in addition to the normal fiduciary responsibilities
relating to profitability. This is a fundamental departure from the previous dispensation with regards to the legal character of Eskom where the mandate was to provide developmental
power for neither profit nor loss.
2
Eskom. 2011. Integrated Annual Report 2011. Johannesburg: Eskom.
3
Koen, M. 2012. Based on the unpublished research report: The Electricity Governance Complex. Civil Society Research and Support Collective.
4
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
5
Eskom. 2010. Climate Change and Sustainability Department, Eskom’s 6 point plan. Available: http://www.eskom.co.za/content/GI0004_6_POINT_PLAN~2~1.pdf.
6
All of these figures come from Eskom‘s Integrated Annual Report 2011.
7
As at 31 March 2011 (Eskom, 2011).
8
Eskom. 2011. Integrated Annual Report 2011. p.324 Johannesburg: Eskom.
9
Eskom. 2006. Annual Report 2006. p.74. Johannesburg: Eskom.
10
Grant, L. 2007. Eskom comes second on world emissions list. Retrieved November 27, 2011, from Treevolution. Available: http://treevolution.co.za/2007/12/eskom-comes-second-
on-world-emissions-list/.
11
This status of second largest utility emitter is also referred to by (Makedi, 2011) in an Eskom presentation to the Renewable Energy Africa conference: Makedi, A. 2011. Eskom’s
view on renewables. Presentation at the Renewable Energy Africa Conference. Retrieved May 15, 2012, from Renewable Energy Africa Conference. Available: http://www.reafrica.
co.za/Images/Presentations%20Day%201/Ayanda%20Nakedi.pdf.
12
Eskom. 2007. Annual Report 2007. Johannesburg: Eskom.
13
Greenpeace. 2011. The True Cost of Coal in South Africa: Paying the price of coal addiction. Available: http://www.greenpeace.org/africa/Global/africa/publications/coal/
TrueCostOfCoal.pdf.
14
Ibid.
The Eskom factor: Power politics and the electricity sector in South Africa 3
Map: the location of the Medupi and Kusile coal power plants currently under
construction in South Africa.
GOOGLE MAPS - © 2012 GOOGLE
4 The Eskom factor: Power politics and the electricity sector in South Africa
2. Historical, political and economic influence
of Eskom
Eskom, a pivotal player in the governance of electricity, operates within a framework that is
largely dominated by the needs of mining and other large industries.
2.1.Early Electricity Provision
In 1923, the Electricity Supply Commission (ESCOM) was By the early 1980s, decision makers realised that growth
founded.15 In line with the 1922 Electricity Act, ESCOM was predictions were wrong. Demand had been overestimated,
established as a relatively autonomous entity, not subject but it was too late: the building of new power stations
to any form of parliamentary oversight, financial controls was irreversible, due to long lead times and cancellation
or state auditing. Importantly, ESCOM would produce and penalties. ESKOM responded in two ways, firstly by
supply electricity neither for profit or loss. In this context, mothballing aging plants20 and thereby saving on input
new generation and distribution capacity needed to be costs, and secondly by seeking new markets. Attempts to
created at the lowest possible cost. This was to be done create such markets included the provision of electricity
either through a new build programme or acquisitions to to black households, so-called ‘homeland’ states and
facilitate a ‘cheap and abundant’ supply of electricity.16 neighbouring countries.21 An additional new market was
created through supplying electricity to the energy intensive
In pursuit of this ‘abundant supply’, ESCOM made industries, such as smelters.
decisions with far-reaching economic consequences.17
However, because ESCOM was relatively independent of
government, with no accountable board, the utility tended 2.2.The Minerals-Energy Complex
to align its objectives with the dominant electricity demands
of the mining companies from its earliest days.18 Historically, South Africa has followed a heavily capital
and energy-intensive development pathway, based
The continued accommodation of mining and industrial almost entirely on coal.22 This pathway has been driven
interests was achieved as ESCOM grew into an absolute by resource extraction and the development of a connected
monopoly by 1948. The rapid growth of industry after set of interrelated economic activities termed the ‘Minerals-
this period meant ESCOM needed to constantly build Energy Complex’.23 24 Eskom has been the cornerstone
new capacity. During the period of massive economic of the Minerals-Energy Complex25, and in turn, the
growth in the 1960s, Eskom’s expansion plans became Complex has become central to the economy.26 This
increasingly ambitious, and ever-larger MW units were Complex consists of mining, minerals processing, the
being commissioned. However, throughout the 1970s, energy sector and linked industries. It is primarily based
projects began to suffer from ‘diseconomies of scale’, on mining, and then on limited beneficiation, underpinned
where the logistics and associated delays (and consequent by the provision of some of the cheapest electricity in the
financing costs) in fact increased the comparative price of world.27
provision.19
15
Conradie, S. a. 2000. A Symphony of Power. The Eskom Story. Johannesburg: Chris van Rensburg Publications (Pty) Ltd.
16
South Africa.1922. Statutes of the Union of South Africa, Act no. 42 of 1922. Act to provide for the supply and control of electricity and for other purposes incidental thereto. Cape
Town: Government Printers.
17
South Africa.1922. Statutes of the Union of South Africa, Act no. 42 of 1922. Act to provide for the supply and control of electricity and for other purposes incidental thereto. Cape
Town: Government Printers.
18
Steyn, G. 2006. Investment and Uncertainty: Historical experience with power sector investment in South Africa and its implications for current challenges. 15 March 2006.
Retrieved March 12, 2012, from UCT graduate School of Business: http://www.gsb.uct.ac.za/files/Eskom-InvestmentUncertainty.pdf.
19
The Eskom Integrated Annual report (2011, p.87) is for example at pains to point out that the current MW price of capacity in the new build process is in line with the international
build prices, be it at the upper end. This is probably in response to reports such as the ‘Study of Equipment Prices in the Power Sector’ (World Bank, 2008) showing comparative
build costs in India, China and even some parts of the USA and Europe as cheaper than those of Medupi and Kusile. (see Yelland, C. 2011. Further cost increases on the cards
for Eskom’s Medupi and Kusile power stations. Retrieved May 4, 2012, from ee publishers. Available: http://www.eepublishers.co.za/article/further-cost-increases-on-the-cards-for-
eskoms-medupi-and-kusile-power-stations.html).
20
Steyn, G. 2006. Investment and Uncertainty: Historical experience with power sector investment in South Africa and its implications for current challenges. 15 March 2006.
Retrieved March 12, 2012, from UCT graduate School of Business. Available: http://www.gsb.uct.ac.za/files/Eskom-InvestmentUncertainty.pdf.
21
As far back as 1980 Eskom reports, “Similarly good progress was made providing electricity supplies to Black urban areas and the national states of Transkei, Bophuthatswana
and Venda. Plans for Escom to augment existing bulk supplies to Soweto, South Africa’s biggest black city are on schedule. ESCOM. 1980. Annual Report. p. 10 Johannesburg:
ESCOM.
22
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
23
Fine, B., and Rustomjee, Z. 1996. The Political Economy of South Africa. From Minerals-Energy Complex to Industrialisation, London, Hurst.
24
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
25
Historically defined, the ‘Minerals-Energy Complex’ is a system in which low paid labour was exploited, and cheap coal based energy with costs externalised to society was used to
support an accumulation regime of a few highly centralised firms focused primarily on capital intensive commodity based industrial activities and the export of basic commodities and
low value add products.
26
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
27
Ibid.
The Eskom factor: Power politics and the electricity sector in South Africa 5
The Minerals-Energy Complex has historically accounted services.41 It has also undoubtedly had an influence on the
for the majority of South Africa’s electricity consumption fact that coal constitutes such a high proportion of South
and emissions, contributing far less to GDP.28 This system Africa’s primary energy consumption, in fact the highest in
is based on the theory that in order to grow the economy, the world in 2003, followed closedly by China.42
it is necessary to have the large centralised baseload
production of electricity, which is distributed through a grid As the layers of governance and planning increased from
to energy intensive users.29 Eskom holds significant 1987, Eskom’s accountability became even more unclear.
referential30 and representational power within This lack of accountability makes it harder for society
important government departments, policymaking, to control the Minerals-Energy Complex. Eskom plays
policy influencing and regulatory bodies. This in turn, a central role in this Complex, which serves to exploit
institutionalises the Minerals-Energy Complex. resources and externalise environmental and social costs
to society as a whole, while creating profits for local and
The South African economy is extremely energy intensive international corporations. It seems clear that a more
compared to international standards31, with only a handful equitable, genuinely accountable system is required.
of countries having higher intensities. In addition, South This means that the dominance of the Minerals-Energy
African industrial energy efficiency is on average significantly Complex and South Africa’s underlying electricity
lower than in other countries.32 This is an important factor, generation and supply paradigm must be challenged.
given that at the moment industry and mining consume
over 60% of the electricity produced in the country,
and the inclusion of commerce takes this figure to Eskom’s role in Africa
almost 75%.33 Therefore, residential energy use makes The trade in electricity in Southern Africa is dominated
up a far smaller portion of final energy demand than in by sales to just three ‘end users’43, who in 2011 used
other countries, and demand from poor households is even 9,322 GWh, at an average cost of 22.6c/kWh. In
smaller.34 Only 16-18%35 of South Africa’s electricity comparison, Eskom sold half that amount of electricity
is used by residential consumers, an outcome of the to utilities in seven countries in the region at an average
energy intensive nature of the economy, and the extreme cost of 50.8c/KWh.44 Eskom has been deeply engaged
income differential in the country.36 in energy-related projects in Africa45, but following the
supply crisis in South Africa in 2007, the utility has
Furthermore, industrial prices are substantially largely withdrawn from Africa, and is now only involved
cheaper than average residential prices. Eskom has in managing generation facilities in Uganda and Mali.
made frequent reference to its industrial tariffs as the
cheapest in the world37, however residential consumers
pay significantly higher prices.38 For example, secret price
deals between Eskom and the Australian mining company 2.3.The “Corporatisation”46 of Eskom
BHP Billiton, are estimated at about 350% less than a
low income residential customer in 2008/9, and less than In the middle of the 1970s, the global crisis in the capitalist
half of Eskom’s reported production price in the period.39 economy saw a significant decline in growth, which led to
With an estimated 12.3 million South Africans still a change in global economic policy. This was the dawn of
without access to electricity40, clearly the focus on the the so-called ‘neoliberal period’ characterised by the rule
Minerals-Energy Complex has had an extensive influence of the market, deregulation and privatisation, decreased
on the provision of energy for households, commerce and spending on social services, the disappearance of the
28
Fine, B. And Rustomjee, Z.1996. The Political Economy of South Africa: From Minerals-Energy Complex to Industrialisation. Westview Press, Boulder, CO.
29
Historically Eskom was created to centralise power supply in this paradigm. Residential access to electricity is a by-product and not the purpose of the current supply paradigm.
30
Eskom has historically retained tight control over information and modelling processes often considered confidential for commercial or competitive reasons. This has tended to
hinder open policy and scientific option debate around a number of key areas.
31
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
32
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive tolow-carboneconomy in South Africa. Climateand Development 1 (2009) 47-65; Hughes,
A, Howells, M. and Kenny, A. 2002. Energy Efficiency Baseline Study. Capacity Building in Energy Efficiency and Renewable Energy (CABEERE). Report No. 2.3.4. Report No.
P-54126. p.52. Department of Minerals & Energy, Pretoria. Available: http://www.dme.gov.za/energy/efficiency_projects.stm.
33
Republic of South Africa, Department of Energy. 2010. South African Energy Synopsis 2010. p.52 and p.66. Available: http://www.energy.gov.za/files/media/explained/2010/
South_African_Energy_Synopsis_2010.pdf.
34
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
35
Republic of South Africa, Department of Energy. 2010. South African Energy Synopsis 2010. p.52 and p.66. Available: http://www.energy.gov.za/files/media/explained/2010/
South_African_Energy_Synopsis_2010.pdf.
36
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
37
See Eskom Annual Reports, 2001-2009.
38
Koen, M. & Bahadur, A. 2010. Eskom: Business as Usual in Africa. Available: http://somo.nl/publications-en/Publication_3603/at_download/fullfile.
39
Ibid. p.79.
40
International Energy Agency. 2011. World Energy Outlook, Access to Electricity. WEO-2011 new Electricity Access Database. Available: http://www.iea.org/weo/docs/weo2011/
other/Energy_Poverty/WEO-2011_new_Electricity_access_Database.xls; Parliamentary Monitoring Group (PMG). 2012. Integrated National Electrification Programme (INEP)
Implementation: Department of Energy, Salga, Eskom Briefing. 13 February 2012. Available: www.pmg.org.za/report/20120214-department-energy-salga-eskom-implementation-
integrated-national-elec.
41
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
42
Ibid.
43
These companies are however, not identified in Eskom’s 2011 Integrated Annual Report.
44
Eskom. 2011. Integrated Annual Report 2011. Johannesburg: Eskom.
45
Libya, Zanzibar, Uganda, Nigeria, Mali, Mauritania, Senegal, Zambia, Mozambique, Namibia, Swaziland and Mauritius. And Eskom Enterprises has also participated in energy-
related projects in India and China.
46
In this context, ‘Corporatisation’ is defined as: to be influenced by or take on the features of a large commercial business.
6 The Eskom factor: Power politics and the electricity sector in South Africa
ideas of the public good/community, and for much of Africa, The restructuring of Eskom resulted in an unmonitored
the implementation of Bretton Wood’s imposed structural electricity pricing policy. Instead of ensuring parliamentary
adjustment programmes. oversight, the “drafters of the new Act, who included
members of ESCOM’s legal department, managed to insert
The South African state started to adopt some neoliberal a clause that exempted Eskom from the requirement to
principles47 after the economy failed to recover have a license issued by the ECB [Electricity Control Board]
significantly through the 1980s.48 The role of the state and thus from having its prices regulated”.58
in the economy was deregulated and reduced. This was
done through various means, including privatising state Eskom’s reluctance to submit its prices for government
owned companies. ESCOM was not exempt from these regulation was at times met with resistance by industry.
reforms. The de Villiers Commission in 198549 marks the When Eskom raised tariffs to pay for the heavy debts it had
start of reform in the sector50: first, corporatising and later incurred, this provoked industry and the mines “to call for
commercialising Eskom. During this process, a system tighter government control to force it to operate on ‘business
was established that continues to reflect the contestation principles’. If this sounded contradictory, Eskom then raised
between the government, vested business interests, and the alarm about “politicians in the engine room” even as
Eskom management until today. it maintained its occupation of the DME [Department of
Minerals and Energy]”.59 After a long period of relative
A new corporate body named ‘Escom’, replaced the autonomy, the utility resented the new interference by
Electricity Supply Commission (ESCOM). The government the state and tried to secure as much independence as
appointed the new Electricity Council to govern Escom’s possible.
corporate body, which was made up of major stakeholders
from business and the municipalities.51 The State President Eskom’s corporate sense that it was a law unto itself was
appointed a chairperson. even more sharply revealed as the political transition
began. “According to its then boss, Ian McRae, staff feared
In 1986, Chairman Maree summarised the new character of that the new ANC government would ‘nationalise’ the
Escom and its ethos of professional managerialism as “the corporation”.60 Consequently, Eskom selectively embraced
only sure way to meet the challenges of electricity supply in portions of the government’s emerging policy. At the same
South Africa is to run Escom as a professionally managed time, Eskom resisted the wholesale carving up and sale of
business undertaking”.52 the organisation.
As part of the corporatisation, the 1985 and 1987
amendments removed the stipulation that “electricity should 2.4.The Post-Apartheid Transition period
be supplied in the public interest […with] operations being
carried out neither for profit or loss”.53 This was replaced
1990-1994
by “consideration for consumer needs being satisfied in
the most cost effective way, subject to resource constraints By the end of apartheid, the dominant Minerals-Energy
and the national interest”.54 The name of the utility was also Complex combined with discriminatory race policies, had
changed to Eskom in 1987. devastated South African society. Freedom brought with
it expectations for change and a need for government to
deliver a ‘better life for all’.61 It was a political imperative
Eskom earnings that government should deliver on this. At the same time
In 2009, the utility earned on average 24.7c for every business had expectations of improved economic growth
kWh it sold. By 2011, Eskom was earning 40.3c on and profits through the re-integration of South Africa into the
average55, and recorded a net profit of R13.2 billion global economy. At first, these seemed to be complimentary
as at March 2012.56 Eskom has not paid dividends to objectives. But the reality proved to be completely different.
its shareholder, the government of South Africa, since
2008 because of its capital expenditure needs.57
47
Gentle, L. 2009. ‘Escom to Eskom: From racial Keynesian capitalism to neo-liberalism (1910-1994)’. In Electric Capitalism: Recolonising Africa on the power grid. (D. McDonald,
Ed.) Johannesburg: HSRC Press.
48
Gelb, S. 1991. South Africa’s Economic Crisis. Cape Town: David Phillip, Publishers.
49
de Villiers, W. d. 1985. Report of the Commission of Inquiry into the Supply of Electricity in South Africa. (Afrikaans). Pretoria: Government Printer.
50
Conradie, S. a. 2000. A Symphony of Power. The Eskom Story. Johannesburg: Chris van Rensburg Publications (pty) ltd.
51
South Africa. 1985. Statutes of the Republic of South Africa, Electricity Amendment Act, Act No. 50 of 1985. Pretoria: Government Printers.
52
Escom.1986. Annual Report. p. 4. Johannesburg: Escom.
53
South Africa. 1922. Statutes of the Union of South Africa, Act no. 42 of 1922. Act to provide for the supply and control of electricity and for other purposes incidental thereto. Cape
Town: Government Printers.
54
South Africa. 1985. Statutes of the Republic of South Africa, Electricity Amendment Act, Act No. 50 of 1985. Pretoria: Government Printers; South Africa. 1987. Statutes of the
Republic of South Africa, Eskom Act, No. 40 of 1987. Pretoria: Government Printers.
55
Eskom. 2011. Integrated Annual Report 2011. Johannesburg: Eskom.
56
Business Day. 2012. Eskom profit rises 60%. Available: http://www.businessday.co.za/Articles/Content.aspx?id=174215.
57
Dames, B. 2011. Presentation on Eskom Audited Annual Results Presentation for the year ended 31 March 2011. October 2011. Retrieved May 5, 2012, from Eskom.co.za.
Available: http://www.eskom.co.za/content/AnnualResultsfinal~1.pdf.
58
Eberhard, A. 2005. From State to Market and Back Again. South Africa’s Power Sector Reforms. Economic and Political Weekly, 10 December 2005 pp. 5309-5307.
59
Hallowes, D. M. 2007. Peak Poison: The elite energy crisis and environmental justics. Johannesburg: groundWorks, p.33.
60
Ibid.
61
The slogan ‘a better life for all’ became the mobilising call and campaign slogan in 1994 by the African National Congress.
The Eskom factor: Power politics and the electricity sector in South Africa 7
‘Cheaper’ electricity for all: price deals and
electrification
Eskom took the initiative in 1991 and proposed a price However, the notion of “who wants it and can afford it”
agreement with government to reduce the real price of meant that communities needed to pay for it. The income
electricity by 20% by 1996.62 The Eskom Chairman’s requirement (cost recovery) needs of Eskom were very
review pledges, “Eskom is sufficiently confident of its future clearly stated by Maree, “It is therefore absolutely clear
business performance to undertake to its customers that that any electrification programme can only be achieved if
it will reduce the real price of electricity over the next five the community wants it and are prepared to pay for it”. In
years by 20%”.63 reference to the National Electrification Forum (NEF), which
was a broad consultative mechanism including communities,
That the intended beneficiaries would be the energy he emphasised the notion of a negotiated process: “It is also
intensive corporations of the Minerals-Energy Complex was clear that communities need to be involved in the planning
made explicit by Chairman Maree: “This reduction in the and provision of electricity to them”.66
price of electricity will place many of our energy-intensive
customers in a much stronger position to compete on Inevitably, community consultation became sidelined
international markets and thus stimulate the export of raw as the NEF consultation process became narrower and
materials and manufactured goods and encourage new more technocratic with the establishment of the Electricity
investment in energy intensive industries”.64 Working Group (EWG) – consisting of representatives from
Eskom, ministries, and municipalities, but excluding labour
The focus on the low-price of electricity also features in and other civil society formations.67 The EWG gave rise to a
Eskom’s 1992 vision: “Eskom is committed to being an government-based committee, the Electricity Restructuring
efficient and effective organization [sic], so as to be able to Interdepartmental Committee. This committee then made
make electricity available to its customers at the cheapest the recommendations forming the basis of the 1998 White
possible price. It is also committed to making electricity Paper on Energy Policy (which included measures such as
available to all in South Africa, who want it and can afford regional distributors, a shift to cost reflective tariffs, and the
it [emphasis added]”.65 opening of generation to competition).
© Greenpeace / Oswald Chikosi, 2011.
62
By 1996 Eskom had in fact reduced real prices by 67% from 1985. Available: http://heritage.eskom.co.za/heritage/Chairmen/Reuel%20Khoza.htm.
63
Eskom.1991. Annual Report. Johannesburg: Eskom, p.5.
64
Eskom.1991. Annual Report. Johannesburg: Eskom.
65
Eskom.1990. Annual Report. Johannesburg: Eskom. p.1.
66
Eskom. 1991. Annual Report. Johannesburg: Eskom. p.6.
67
Greenberg, S. 2008. Market liberalisation and continental expansion: The repositioning of Eskom in Post Apartheid South Africa. In Electric Capitalism. Johannesburg: HSRC Press.
8 The Eskom factor: Power politics and the electricity sector in South Africa
3.Influence and accommodation: Eskom and
Government Policy 1994-2001
Eskom undoubtedly has a dual role. On one hand, The role of electrification
the utility can be seen as an extension of government
and its policy. On the other hand, Eskom’s corporate The initial national electrification process was a clear
(and later commercial) logic led to a preservation of imperative for the new government and Eskom responded
its organisational position, and continued to facilitate accordingly, effecting 2 812 847 connections between 1991
the accumulation of wealth within a framework of the and its commercial incorporation in 2001.70 71 Securing
Minerals-Energy Complex.68 former Black Local Authorities (BLA) distribution networks
meant that Eskom was able to ensure it remained relevant
Due to the dominance of the Minerals-Energy Complex, during the transition by positioning itself to take on the
since 1987 South Africa’s underlying electricity generation electrification backlog to predominantly black households.
and supply paradigm has never been challenged.69 To date, 4 050 968 homes have been electrified since 1991,
The reality is that the policy environment has become based largely on a prepaid metering system.72
increasingly confusing, and sometimes contradictory.
This, combined with overlapping roles and responsibilities However, Eskom’s electrification drive was based on the
within the governance of the utility has deflected attention commercial rationale that extending the domestic market
away from the underlying paradigm of large centralised would improve income generation as well as independence
(baseload) generation, serving energy intensive users at from the state. But average consumption fell far short of
the expense of both the environment, and people’s health what Eskom assessed was needed to make the programme
and access to energy. commercially viable.73 74 People simply could not afford to
buy enough electricity to make this profitable.75 Indeed,
The objectives of the post-apartheid government have providing large-scale electrification to a large proportion
clearly influenced the actions of the utility in many of South Africa’s population since 1990 has actually had
fundamental ways. Transformations in terms of employment relatively little impact on overall electricity consumption.
equity, addressing past discrimination and, more recently, The addition of over three million new (primarily low-income)
broad based black economic empowerment, have all been residential customers between 1990 and 2004 only increased
appropriately high on the state’s agenda. Similarly, it was Eskom’s sales by approximately 4%.76
crucial that the discriminatory patterns of service delivery
be addressed post-1994. In April 200177 78, the Department of Minerals and Energy
began funding the Integrated National Electrification
While some of Eskom’s actions were no doubt an Programme (INEP) directly.79 Nonetheless, Eskom retained
accommodation of the new government’s developmental a strong influence over the process: Eskom personnel
needs, the utility’s growing commercial motivation also were simply seconded to the Department. According to
played a role. The corporatisation of Eskom and a need Clarck (2007: 17) “Macro [electricity] planning is currently
to soak up excess capacity through the creation of new undertaken by the Integrated National Electrification
markets meant that many of the issues that would be central Programme Business Planning (INEP BP) Unit. Previously
for the new government already had an existing commercial housed within Eskom, this unit is now separate from it,
rationale within Eskom. The accommodation of government though most of its staff have been seconded, on ministerial
needs can therefore been seen as the intensification of a request, from Eskom”.80
pre-existing commercial direction, rather than a reversal of it.
68
Hallowes, D. M. 2007. Peak Poison: The elite energy crisis and environmental justics. Johannesburg: groundWorks.; McDonald, D. 2009. Electric Capitalism: Recolonising Africa
on the power grid. Johannesburg: HSRC Press.; Koen, M. and Bahadur, A. 2010. Eskom: Business as Usual in Africa. Available: http://somo.nl/publications-en/Publication_3603/
at_download/fullfile.
69
McDonald, D. 2009. Electric Capitalism: Recolonising Africa on the power grid. Johannesburg: HSRC Press.
70
Eskom. 2002. Annual Report. Johannesburg: Eskom.
71
Nearly all of these new connections have used pre-payment technology – customers buy tokens or top-up electronic cards to activate their electricity dispenser. Many connections
involve informal houses (shacks) and use pre-wired “ready boards” – typically with a few lights and plug points.
72
Eskom. 2011. Integrated Annual Report 2011. p. 182. Johannesburg: Eskom.
73
The average consumption of 100 kWh fell far short of the 350 kWh Eskom assessed was needed to make the programme commercially viable.
74
Clarck, A. 2005. Resource-based Technology Innovation in South Africa: Innovations in South Africa’s Off-grid. Johannesburg: HSRC Press.
75
In 2001 for instance, the average monthly revenue per prepaid customer was just R30. Source: Eskom Annual Report 2001.
76
Winkler, H., Marquand, A. 2009. Changing development paths: From an energy-intensive to low-carbon economy in South Africa. Climate and Development 1 (2009) 47-65.
77
Eskom. 2002. Annual Report. Johannesburg: Eskom.
78
Eskom, which had been funding the programme from tariffs to this point, was about to start paying taxes and dividends to government in its commercialised form (South Africa,
2001) and therefore argued electrification should come out of these payments.
79
Hallowes, D. M. 2007. Peak Poison: The elite energy crisis and environmental justics. Johannesburg: groundWorks.
80
Clarck, A. 2005. Resource-based Technology Innovation in South Africa: Innovations in South Africa’s Off-grid. p. 17 Johannesburg: HSRC Press.
The Eskom factor: Power politics and the electricity sector in South Africa 9In more recent times, the pace of electrification has slowed the cabinet prevented Eskom from engaging in any further
as a result of rising costs per connection and the level generation capacity development from the time of the 1998
of government funding for electrification. According to a White Paper on Energy Policy, to 2004.89
parliamentary briefing by the Department of Energy, Eskom
and the South African Local Government Association In a speech to the Africa Energy Forum in 2001, Minister
(Salga), by 2012 there has actually been “a decrease in real of Minerals and Energy at the time, Phumzile Mlambo-
terms of the electrification allocation”.81 In addition, it was Ncguka, summarised the government’s objectives thus:
reported that the INEP operational budget is “not sufficient “The energy sector is being restructured in order to ensure
to plan, implement and monitor projects effectively”.82 that we reduce the cost of energy, improve economic
efficiency, attract local and foreign direct investment,
At the same time, the South African government has an diversify energy resources for environmental reasons,
ambitious timeline for establishing universal access to and ensure security of energy supply. This will ensure the
electricity in South Africa by 2014. Eskom has raised doubts delicate balance between State’s imperative to spur on
about meeting this deadline, and in 2011, Eskom was economic growth and its social responsibilities...[In] order to
unable to meet its electrification target.83 The utility’s limit the expected upward pressure on electricity prices due
current 10-year electrification programme does not cater to Eskom’s new dividend and tax payments status, there
for universal access by 2014, but claims that a 2021/2022 is a need to build new generating capacity, to encompass
timetable is more realistic. According to Eskom “If this environmental considerations, and to reform the...[sector].
programme has to be expedited, it will severely limit the Government will ensure that these price increases will be
ability to execute the spend in other categories and increase kept as low as possible, so that South Africa maintains its
the operational expenditure due to increased connection competitiveness, cross subsidies for the poor, and free
numbers” 84, once again highlighting the contested nature basic services to bring relief to the poor”.90
of this country’s electricity sector.
However, the state’s emphasis on social responsibilities
nevertheless meant that in practice those duties were
The government’s managed liberalisation of the increasingly shifted to individuals. The large-scale
electricity sector introduction of prepaid metering systems was one
outcome of this process. It ensured consumer discipline
In the late 1990s international globalisation trends meant with disturbing consequences: households would simply
that the focus was not on whether to liberalise, but rather cut themselves off when they could not afford to pay for
on how to liberalise the electricity sector.85 The South electricity. The potential social benefits of extending
Africa government had opted for what they referred to as electricity access were therefore completely undermined.
‘managed liberalisation’.86 As a result of this approach,
Eskom’s electricity customers
Only 139 customers account for 34.9% of Eskom’s total revenues87, however these customers generally pay less than
half what the majority of customers pay. In 2011, mining and industry customers paid an average of 36.2c/KWh, while
4.5 million direct residential customers paid on average 66.4c/KWh.88
© Greenpeace / Shayne Robinson, 2011.
© Greenpeace / Les Stone, 2011.
81
Parliamentary Monitoring Group (PMG). 2012. Integrated National Electrification Programme (INEP) Implementation: Department of Energy, Salga, Eskom Briefing. 13 February
2012. Available: www.pmg.org.za/report/20120214-department-energy-salga-eskom-implementation-integrated-national-elec.
82
Ibid.
83
Eskom states this as one of the challenges: “Not meeting the target of 158 430 overall electrification connections this year (149 914 made)” in Eskom. 2011. Integrated Annual
Report 2011. p. 168 Johannesburg: Eskom.
84
Eskom. 2011. Integrated Annual Report 2011. p. 180. Johannesburg: Eskom.
85
Koen, M. 2011. There’s an Elephant in the Room. Greenwash and Socialwash in Eskom’s sustainability reporting. Durban: Working Paper. CSRSC.
86
The partial privatisation of risks and the introduction of ‘quasi-markets’ in the administration of benefits under the strict control and management of the Government.
87
Dames, B. 2011. Presentation on Eskom Audited Annual Results Presentation for the year ended 31 March 2011. October 2011. Retrieved May 5, 2012, from Eskom.co.za.
Available: http://www.eskom.co.za/content/AnnualResultsfinal~1.pdf.
88
CSRSC calculations, based on figures in Eskom’s 2011 Integrated Annual Report.
89
Department of Minerals and Energy. 1998. White Paper on Energy Policy. Pretoria: Government Printers.
90
Mlambo-Ncguka. 2001. Politics of Electricity Sector Reform in South Africa: Managed Liberalisation and Developmentalism (2009-2014). Retrieved October 10, 2009, from Africa
Energy Forum. Available: www.researchandmarkets.com.
10 The Eskom factor: Power politics and the electricity sector in South Africa4. Commercialisation of Eskom: 2001-2012
Following on from the Eskom Conversion Act in 2002, In 2012, South Africa’s electricity sector looks like
Eskom was converted from a statutory body to a public this:
company (Eskom Holdings Limited), with the South
African government as the sole shareholder. A board • An estimated four million households have been
was then established, but was “comprised almost entirely connected to electricity since 199194, but these
by big business, with a handful of academics and a connections are characterised by chronic under
sole representative of the DPE”.91 The impacts of the consumption of less than 100kWh per month;
government’s managed liberalisation approach are clear, • The social development potential of electricity has
with the Eskom Conversion Act attempting to balance been largely negated by cost recovery policies resulting
the competing narrative of Eskom’s ‘developmental role’ in disconnections and self disconnection through
and the need for ‘affordable electricity’.92 In reality, these prepaid metering systems;
competing interests have never been resolved. • Domestic consumption is still a fraction of industrial
consumption and poor households an even smaller
Indeed, it was this approach that prevented Eskom from fraction of this;
investing in new capacity before 2004, and precipitated • Service related protests are common place and often
an electricity supply crisis in 2007, which continues to relate to electricity;
date, despite policy acknowledgement of the problem ten • No significant renewable sources of energy have been
years previously.93 The crisis in 2007 meant that Eskom developed;
was told to accelerate building new capacity quickly, and • The carbon footprint of the utility continues to grow
urgently began investing in a ‘new build programme’. This substantially;
programme consists almost entirely of new major coal-fired • Dwindling water resources are further threatened by
capacity (Medupi and Kusile) as a supposedly ‘least cost’ technology choices;
and ‘proven technology’ solution. Thus, the earlier policy • Coal mining has boomed along with the negative
immobility, followed by the urgency to seek solutions to the impacts of acid mine drainage and toxins;
supply crisis meant that the necessary space to develop • Allegations of corruption in the award of tenders for
better alternatives was completely absent. capital expenditure projects continue to surface;
• Real prices for electricity reduced by around 67% over
The National Energy Regulator (NERSA) became 20 years, and then have escalated by 300% in just a few
operational in 2008, but given the monopolistic nature of years;
South Africa’s electricity market, the regulator’s dominant • A supply crisis in 2007 followed by ‘scheduled’ outages
role thus far has been to adjudicate Eskom’s price referred to as ‘load shedding’ resulted in large scale
applications. The nature of these decisions has had the economic harm and job losses;
effect of deflecting accountability from both the state and • Debt and spiralling prices limited the country’s ability to
the state-owned enterprise. respond to the global economic crisis;
• A controversial World Bank loan has been sourced for
Since 2001, government roles in the electricity sector building additional coal-fired generation capacity
have become increasingly complicated with the following (Medupi); and
departments involved in one way or another: The Department • Amidst these problems large bonuses continue to be
of Public Enterprises, The Treasury Department, The paid to the utility’s leadership.
Department of Energy, The Department of Minerals, The
Department of Environmental Affairs and The Department
of Local Government.
Salaries
In 2011, Eskom’s CEO earned R478 000 per month
In fact, by 2012 the contestation for control of
(including bonuses).95 Compared to this, the median
Eskom from different economic interests (including
minimum monthly wage in South Africa was R3162 per
the Minerals-Energy Complex and Eskom itself),
month in 2011.96 Based on these calculations, the ratio
inappropriate governance and regulation structures,
of the CEO’s salary to a minimum wage income is thus
role confusion and policy uncertainty have in fact
151:1.97
resulted in less accountability to the real owners of the
utility: the people of South Africa.
91
Greenberg, S. 2008. Market liberalisation and continental expansion: The repositioning of Eskom in Post Apartheid South Africa. In Electric Capitalism. Johannesburg: HSRC
Press.
92
South Africa.2001. Statutes of the Republic of South Africa, Eskom Conversion Act, No. 13 of 2001. Pretoria: Government Printers.
93
Department of Minerals and Energy. 1998. White Paper on Energy Policy. Pretoria: Government Printers.
94
Eskom. 2011. Integrated Annual Report 2011. p. 182. Johannesburg: Eskom.
95
Eskom. 2011. Integrated Annual Report 2011. Johannesburg: Eskom.
96
Labour Research Services. 2011. Bargaining Indicators for 2011. Cape Town: LRS.
97
Koen, M. 2012. Based on the unpublished research report: The Electricity Governance Complex. Civil Society Research and Support Collective.
The Eskom factor: Power politics and the electricity sector in South Africa 115. Eskom and Water
In a water-scarce country like South Africa, the supplies of water in the Eastern Transvaal by reversing the
decisions taken around the consumption of water have flow of the Vaal River by pumping water up the river over
major implications. As a strategic water user, Eskom’s a series of seven weirs. The scheme was completed in
investment decisions do play a role in the equation: in 20 weeks at a cost of some R28 million, to which ESCOM
2011 alone, Eskom consumed 327.252 Ml of water.98 The contributed R19 million and SASOL, another large water
new power stations currently under construction (Medupi user in the Eastern Transvaal the remaining R9 million”.102
and Kusile) are to be ‘dry-cooled’ as part of Eskom’s climate
change adaptation strategy and its claimed commitment However, the lessons of the drought were quickly forgotten,
to the environment.99 Importantly, because both of these as the construction of Majuba in the late 1980s shows. In
power stations are being built in already polluted areas, 1995 it was decided to go ahead with the last three units.
both stations will require the installation of a flue gas Costs had spiraled, as the coal reserve was far lower
desulphurisation plant, significantly increasing the water than the geological survey had predicted. This meant that
usage of these power stations. coal had to be transported by road and rail, and Majuba’s
cost of generation was far higher than anticipated. As a
But using dry-cooled technology is not a shift in Eskom’s consequence, the last three units commissioned were once
strategy. Over 20 years earlier, Eskom had already opted again cheaper, water-inefficient, water-cooled options.103
for dry-cooled technology in the previous build programme.
This was out of necessity as there were insufficient water It is often accepted that Eskom is the source of knowledge
resources to support the intended power stations.100 The and expertise in the electricity sector. However, the lessons
annual report of 1983101 describes Kendal, Matimba and of the past are clear: demand projections can be wrong,
Majuba stations as air-cooled based on lessons learned coal reserve estimation is far from exact and the nature of
from the smaller Grootvlei station that was already dry- South Africa’s water supply is incredibly fragile. Despite
cooled, as not enough water could be found to service the this, Eskom continues to make the same decisions, and
station. potentially the same mistakes that it did in the past.
These three stations were planned during a severe drought It is estimated that the hidden costs of Kusile could be as
in 1982/3. During this period, many existing power stations much as Three Trillion Rand over its 50 year lifespan.104
were unable to run at capacity because of insufficient water The water impacts dominate these externality costs –
supply. It cost R100 million to augment water to the large approximately 70% of the external costs are water-
power stations during the drought, which was done through related105, and per unit of electricity produced, Kusile will
emergency pumping schemes in the Eastern Transvaal. In use 173 times more water than wind power would. Building
a demonstration of the Minerals-Energy Complex at work in inflexibility, instability, and water uncertainty into South
in a crisis, the 1983 annual report describes the measures Africa’s electricity system.
taken, “water affairs developed a scheme to augment the
© Greenpeace / Jennifer Bruce, 2012.
© Greenpeace / Les Stone, 2011.
98
Eskom. 2011. Integrated Annual Report 2011. p.11. Johannesburg: Eskom.
99
Eskom. 2006a. Annual Report. Johannesburg: Eskom.; Eskom. 2011. Integrated Annual Report 2011. Johannesburg: Eskom.
100
Steyn, G. 2006. Investment and Uncertainty: Historical experience with power sector investment in South Africa and its implications for current challenges. 15 March 2006.
Retrieved March 12, 2012, from UCT graduate School of Business. Available: http://www.gsb.uct.ac.za/files/Eskom-InvestmentUncertainty.pdf.
101
ESCOM. 1983. Annual Report. Johannesburg: ESCOM.
102
ESCOM. 1983. Annual Report. p. 21. Johannesburg: ESCOM.
103
Steyn, G. 2006. Investment and Uncertainty: Historical experience with power sector investment in South Africa and its implications for current challenges. 15 March 2006.
Retrieved March 12, 2012, from UCT graduate School of Business. Available: http://www.gsb.uct.ac.za/files/Eskom-InvestmentUncertainty.pdf.
104
Greenpeace. 2011. The True Cost of Coal in South Africa: Paying the price of coal addiction. Available: http://www.greenpeace.org/africa/Global/africa/publications/coal/
TrueCostOfCoal.pdf.
105
The report measured the ‘scarcity value’ or ‘opportunity cost’ of water.
12 The Eskom factor: Power politics and the electricity sector in South Africa6. Conclusion
Eskom clearly plays an influential role in South Africa’s The results of a quarter century of electricity sector reform
electricity, policy and regulatory environment. The utility have been excellent from the perspective of the mines,
has staff seconded to numerous government bodies, and is banks and heavy industry. However, from a social and
often called upon to offer technical, logistical and financial environmental sustainability perspective, the results have
support to the government, as well as participating in forming been deeply worrying. The Minerals-Energy Complex
parliamentary opinion through various subcommittees.106 remains central to the type of electricity investment Eskom
However, it is inherently difficult to analyse the sustainability decides to make. Indeed, Eskom is at the heart of this
performance of a state-owned utility like Eskom. paradigm, and both promotes and benefits from it.
The question becomes: to what extent does one focus But one thing remains clear: The ground-breaking
on Eskom itself, as opposed to the relevant government decisions South Africa needs to make today cannot
departments, policy processes, parliamentary oversight, become the victim of play-offs in responsibility and a lack
and regulatory institutions? Drawing the lines as to where of accountability. The question of “Who is responsible”
Eskom’s responsibility and accountability lies often proves demands urgent answers in the face of an accelerated
difficult, given that the utility occupies an effective monopoly climate crisis, the growing gap between rich and poor,
position in the absence of any real competition. Eskom’s unacceptably high levels of inequality and unemployment,
shift in an increasingly commercial direction has had lack of service delivery, lack of access to affordable
two key consequences: while government oversight has electricity, a potential water crisis, and the continued
increased, overall accountability has decreased. The dominance of big industry and vested interests.
outcome is clear: a lack of genuine accountability for
Eskom, as well as the government. And this lack of clarity Continuing along South Africa’s current pathway is clearly
works for both parties, in that they are continuously able to not going to address any of these problems. The country’s
shift responsibilities from one to the other – pointing out that electricity system relies on coal, large scale centralised
it is not them making the decisions, or with the expertise. generation and decision-making behind closed doors. The
centrality of energy-intensive industries comes at the
Eskom’s decisions have repeatedly confirmed the utility’s expense of all South Africans, making profits for a
commitment to the central paradigm of large scale centralised privileged few. Therefore, the dominance of the Minerals-
generation and grid-based distribution to energy-intensive Energy Complex and South Africa’s underlying electricity
corporations, which lies at the heart of the Minerals-Energy generation and supply paradigm must be challenged.
Complex. Government holds a series of roles or spheres
of influence and accountability with regards to the utility. In the pursuit of a sustainable future, a major paradigm shift
These are, amongst others, that of shareholder, regulator, is required. This means that it is time for real accountability
policy creator and political patron. This leads to confusion from the government, and from Eskom. The utility needs
over accountabilities and the extent of strong directive to stop building new coal-fired power stations, and
influence and control by the state, introduces the possibility should instead invest in the substantial rollout of large-
for corruption, ad hoc interference, and most importantly, a scale and decentralised renewable energy projects. It is
lack of accountability amongst all players. also time for the Minerals-Energy Complex to become far
less central to the South African economy. A just transition
As a result Calland and Pienaar107 make the comment away from coal and towards renewable energy is required
that “Picking holes in the governance of electricity supply, to secure the country’s electricity supply, create jobs, ensure
and energy policy more generally, is like shooting fish in a energy access, and avoid a water crisis exacerbated by
barrel. Whether it is the development and sequencing of catastrophic climate change. It is time for Eskom to finally
key policy documents, the absence of proper stakeholder learn the lessons of the past. It is not yet too late.
consultation, leadership failure, or the lack of clarity about
intra-governmental roles and responsibilities, there are
more hooks on which to hang a public debate than in a
cloakroom”.108
106
A parliamentary subcommittee plays an oversight role of state owned enterprises while others focus on the development of policy and legislation in the areas that affect decisions
relating to development, environment, energy etc.
107
Calland is director of Idasa’s Economic Governance Programme, which convenes the multi-stakeholder Electricity Governance Initiative of SA (EGI-SA), and associate professor
in public law at UCT. Pienaar is senior researcher: public ethics and governance.
108
Calland, R. A. 2009. Left in the dark, public could pay heavy price for decades. Retrieved May 2, 2012, from Business Day. Available: http://www.businessday.co.za/articles/
Content.aspx?id=88535http://www.businessday.co.za/articles/Content.aspx?id=88535.
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