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Lack of accountability has served the interests of opportunists in fossil fuel industries

Richard Worthington
By Richard Worthington
22 Jul 2024
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Lack of accountability has also allowed the Department of Mineral Resources and Energy to ignore recommendations by the Presidential Climate Commission and any attempt to develop a long-term strategy to reduce our dependence on fossil fuels.

It is clear that some power struggles within the ANC were papered over with ambiguity in the process of establishing a Cabinet, at least with regard to our energy system. Thus the power struggles continue and are likely to play out more publicly, quite possibly in Parliament, which in theory has the power and responsibility to resolve them.

Instead of simply reversing the error made when President Cyril Ramaphosa first constituted a Cabinet, sublimating what was the stand-alone Department of Energy to the Minister of Mineral Resources to create the Department of Mineral Resources and Energy (DMRE – the two departments have not actually combined, though a process was initiated), now a couple of words that should be redundant have been deployed, and not for the sake of clarity.

In both cases – creating the DMRE and now the Department of Mineral and Petroleum Resources (DMPR) – the most credible cause is senior ANC power broker Gwede Mantashe.

Where the buck stops


Electricity is unambiguously in the domain of energy, so adding the word to the title of the minister and the Department of Energy suggests that it may serve to qualify the mandate. However, this minister is surely where the buck stops for implementing the National Energy Act (2008), and is thereby responsible for undertaking Integrated Energy Planning (IEP), the process legally required for determining the desired primary energy supply mix of the country.

Oil and natural gas are by definition mineral resources. Petroleum refers to the liquid form of hydrocarbons – traditionally oil and the various fuels derived from oil, but increasingly embracing gas, as it can be liquefied (LNG) or converted to a liquid (GTL). Including the term in the title of the minister and DMPR is clearly additive – extending the mandate beyond getting mineral resources out of the ground and into the market, potentially embracing the entire petroleum products value chain.

Mantashe’s department tabled the SA National Petroleum Company Bill (SANPC) last year, so it appears that the formation of such an entity – incorporating iGas, PetroSA and the Strategic Fuel Fund (effectively replacing the Central Energy Fund, while also seeking to shed some debt) – is being supported, with the minister as the shareholder representative.

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However, this draft legislation proposes a mandate that goes beyond petroleum products to include “providing for renewable energy” and “the acquisition, generation, manufacture, marketing or distribution of any form of energy”.

The SANPC Bill gives Parliament the opportunity to require clarification of energy mandates and associated amendments; though it could reject the bill in deference to the National State Enterprises Bill, which provides for putting SOEs under the Presidency.

The Gas Masterplan (GMP) is also indicative of the mandate sought by Mantashe and points to a key dynamic in the contestation of powers: the GMP wants large-scale gas-fired electricity generation to serve as the anchor customer for major supply-side investments, as also provided for in the draft IRP2023 (the electricity Integrated Resource Plan that mandates investments in generation).

Contested issue


Whether this would be good for the electricity supply industry and consumers is a contested issue that should be interrogated through integrated planning covering the entire energy system – the IEP process.

Another contested issue is the future of petroleum products in transport in a global context of the adoption of electric vehicles (EVs) exceeding all mainstream expectations, while South Africa continues to support the production of petroleum-fuelled vehicles.

Recognising renewable energy within the SANPC is consistent with policy requiring the blending of petroleum products with a portion of biofuels that in theory are produced sustainably, but this is far less beneficial than electrification of transport.

Responsibility for eliminating energy poverty is also in play: many government-endorsed alternatives to “traditional biomass” energy, which still provides a significant proportion of energy services in low-income households accounting for over 5% of total primary energy supply in South Africa, are also petroleum products – most clearly LPG (“bottle-gas”) and paraffin, but bioethanol is also a liquid hydrocarbon.

Therefore allocation of government funds for increasing access to electricity, which is the best way to address energy poverty and the highly gendered impacts of traditional biomass use, may have to compete with subsidies for the supply of petroleum products.

 Avoiding accountability


Ambiguity over responsibilities can be a means for avoiding accountability while keeping space open for leverage by key players – leverage that would be constrained by coherent and participatory planning. A great deal therefore rests on the shoulders of Minister Kgosientsho Ramokgopa, his ability to revitalise the Department of Energy and his resolve in setting up a transparent and credible IEP process.

Lack of accountability has served the interests of opportunists (and some incumbents) in the fossil fuel industries, particularly coal and diesel supply chains, though it has not benefited the minerals sector as a whole, or security of energy supply.

It also allowed the DMRE to ignore recommendations by the Presidential Climate Commission and any attempt to develop a long-term strategy to reduce our dependence on fossil fuels.

The painfully slow progress of the Climate Change Bill also provides opportunity for those seeking to deepen our fossil dependence by securing private sector investments “enabled” by the government before binding policies and measures are adopted.

It seems reasonable to expect the new minister of forestry, fisheries and the environment to be a clear ally of the minister of electricity and energy, and champion of the IEP process, which should complement implementation of the Mitigation System, crucial to the credibility of South Africa in the multilateral climate arena and efforts to secure climate finance.

Creative ambiguity could (additionally to papering over contestation within the ANC) be part of an artful strategy looking beyond the establishment of a Cabinet, allowing for and even necessitating more transparent contestation over mandates in our National Assembly, hopefully with rational deliberation of energy governance structures and ministerial powers and responsibilities.

This should serve as a proving-ground for a more robust Parliament, sooner rather than later. DM

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