Electricity Minister Kgosientsho Ramokgopa has described South Africa’s highly fragmented electricity distribution industry as a threat to energy security that warrants attention “on the scale and intensity” that has been given to the country’s generation shortfall in the recent past.

Delivering an update on the implementation of the Energy Action Plan in Parliament, Ramokgopa said that a significant number of municipalities were in a state of paralysis and unable to perform their mandated duties, including in the area of electricity distribution.

He described a recent six-week outage in the Ditsobotla local municipality as emblematic of the structural weaknesses in the sector.

The crisis was broad-based, however, manifesting in both an inability of municipalities to service their Eskom accounts, as well as a chronic under-investment in new distribution assets and maintenance of existing infrastructure.

Illegal connections were also resulting in a growing failure of infrastructure as demand exceeded capacity, while theft and vandalism was triggering lengthy outages and increases in reactive maintenance expenditure.

He said that, as of July 2023, the total overdue municipal debt to Eskom stood at R63.2-billion, representing growth of R4.7-billion on the figure reported at year-end.

“These conditions have highlighted the threat to energy security and warrant similar attention on the scale and intensity the generation industry has seen in the recent past,” he said.

Ramokgopa reported that the following policy considerations were receiving urgent attention in an effort to tackle the crisis:

• Deliberations on the future of municipal revenue in the context of revenue migration due to an increased uptake in behind-the-meter, small-scale embedded generation projects;
• The funding and project management of investments required to strengthen, expand and modernise the distribution infrastructure to support growth and the future architecture of the industry in line with constitutional directives; and
• Moves to bring policy and regulatory certainty regarding feed-in tariffs and wheeling agreements.

“These discussions are at various stages, and members of this house, particularly the Finance and Cooperative Governance and Traditional Affairs Portfolio Committees, must take a keen and robust interest in the discourse.”