Tuesday, April 01, 2008

Electricity Woes

So ESKOM expects us, the population, to decrease out usage of electricity by 10% in order to stave off the so-called load shedding. Without putting too fine a point on it, this is another example of the type incompetent management that has landed us in this mess in the first place.

Firstly, whether we do or don't reduce out power consumption by 10% we are going to be subjected to load shedding - spot the incentive to save electricity.
Secondly, those people who have actually cut down on electricity usage by replacing lightbulbs, installing solar geyser, switching to gas for cooking etc are now in a pickle. They ALSO have to reduce their consumption by 10% but now, having done the easy ones, in order to save another 10% it gets more and more difficult and more and more expensive. Isn't it ironic that the rules as communicated at the moment are going to penalise both the historically responsible and the historically irresponsible.
Thirdly, increasing the price of electricity, which I happen to fully agree with, has to be done across the board for both domestic and agricultural and industrial users. If it isn't, then all that happens is that those paying the higher price effectively subsidise those paying the lower prices.
Fourthly, Domestic use account for a relatively small proportion of the total electricity use so cutting it by 10% is actually only cutting it by 10% of the 30 or 40% of the total that it constitutes.
Fifthly, reducing electricity consumption can only be done two ways. Either one changes one's lifestyle or one pays for energy efficient appliances. The thought of changing one's lifestyle e.g. cold showers because ESKOM is incompetent is probably not going to happen in a hurry, people don't change lifestyle easily even if there are very good reasons for doing so. That leaves us at the pay option. Assuming that I am a good citizen and I go and install a solar geyser, a gas oven and replace all lightbulbs with energy saving ones that will set each household back about R20,000.00. Multiple that by the number of households which, I'm guessing here, would be about 1,000, 000 that use the majority of domestic consumption and one gets to a staggering total of 20 BILLION rand that the tax paying citizens have to cough up.

My solution would be to seriously look at shutting down all aluminium smelters AND increase electricity prices across the board for the following reasons:
1. I have read somewhere that they on their own consume 10% of total electicity consumption, I am open to correction on this.
2. Aluminium smelter don't employ a lot of people so the inevitable job losses are more easily manageable and well defined.
3. Increasing electricity prices will encourage people over time to move to energy efficient technology but because it is over time it will be more of a replace what is broken with energy efficient appliances rather than throw away working appliances and replace.
4. Aluminium smelters simply export our very cheap electricity. The bauxite arrives in ships, uses our electricity to refine it and then leaves as aluminium. Why, when we don't have enough electricity to go around are we exporting our electricity?

Of course, this will never happen because:
1. It will mean tough decisions have to be made by ESKOM and tough decisions only get made by competent management.
2. There are long term contracts in place already which have to be negotiated out of but if you weigh up the 20 Billion that tax payers are going to pay to reduce electricity and the penalties that getting out of the contracts are going to incur. 20 Billion takes a lot of topping.
3. A follow on from 2, someone has to take responsibility for getting out of those contracts and responsiblity isn't ESKOMs strong suite. We are already getting the message from ESKOM that the reason that we're in this pickle is because we, the public, use too much electricity not that ESKOM were incompetent in their handling of the entire crisis.
4. Contracts with the smelters are going to have to be renegotiated anyway to take into account the general price rises in electricity. Oh, I forgot, they aren't going to be renegotiated - we the public are going to end up subsidising industry.
4. Reneging on the contracts or force buying the smelters is going to seriously piss off some major heavy weight industrial conglomerates. Again, ESKOM doesn't have the gutzpa to do this.
5. My very rough and ready calculations could be way off which would let ESKOM off the hook and before anyone picks up on this as a sign of my own incompetence. Energy is not my business as it is ESKOMS.

Ok, got that off my chest. Now I can go back to more pleasant commentary.

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