The Democratic Alliance has lambasted a government proposal to create a second state-owned electricity generation company in South Africa, labelling the plan “utter madness”.

In a statement, the party’s spokesman on mineral resources & energy, Kevin Mileham, said that instead of making the South African electricity supply sector more competitive, government is seeking to extend its monopoly over electricity generation.

“South Africa doesn’t need another state-controlled entity for electricity generation when there are myriad independent power producers who are ready and willing to generate electricity in order to diversify South Africa’s energy mix, making it more reliable and cheaper.”

Speaking at the Investing in African Mining Indaba conference in Cape Town on Monday, energy minister Gwede Mantashe said South Africa should create a new government-owned entity to generate electricity and reduce the country’s reliance on Eskom.

Mileham said South Africa needs a competitive energy-generation sector to ensure security of supply.

“As a starting point, parliament should pass the DA’s independent electricity management operator private members bill, which will allow all power producers to compete on a level playing field. The minister should also take the necessary steps to open the next bid window for independent power producers as a matter of urgency,” he said.

He added that Mantashe’s promise to allow mines to generate electricity for their own use is “an admission by the ANC that Eskom’s monopolistic stranglehold on the energy sector is simply not feasible”. — (c) 2020 NewsCentral Media