Eskom Board chairperson, Dr Mteto Nyati, delivering akeynote address at the first day of the Joburg Indaba 2024 yesterday in Johannesburg. Picture: Supplied
Eskom chairperson Mteto Nyati has called on leaders of critical economic institutions to rise up to the daunting challenges in navigating South Africa’s energy trilemma: balancing energy security, sustainability, and affordability.
In his address at the 12th Joburg Indaba yesterday, Nyati credited the company’s progress in stabilising energy supply, marking an end to load shedding since late March 2023.
However, he underscored the pressing need to tackle affordability and sustainability as the next critical frontiers.
Nyati articulated a clear vision for Eskom’s future, stroking a chord of optimism by advocating for tariff structures that were attractive to investors. He reminisced about the historically low tariffs Eskom provided, noting the importance of returning to such levels to spur investment in the sector.
“We need tariffs that attract investors. Eskom used to have tariffs that were relatively cheap and we need to get back to where we were,” Nyati said.
“We also need to address to issue of sustainability as we transition away from coal. As leaders we need to encourage innovation that drives down costs. That is why we have embraced the unbundling of Eskom into three separate units and why we are moving ahead with digital transformation.
“As leaders, we need to encourage innovation that drives down costs,” he stated, referencing Eskom’s ongoing digital transformation and its strategic unbundling into three operational units.
These steps, he argued, were vital for navigating the shift away from coal and ensuring a sustainable energy future.
With a broader lens, Nyati called on leaders within the industry to embrace the evolving focus on ESG—environmental, social, and governance issues—as a path to achieving a competitive edge in a rapidly changing landscape. He further urged industry leaders to engage in a collaborative manner that prioritises win-win outcomes for the country in the geopolitical arena.
Addressing the topic of inclusive economic growth within the mining sector, Nombasa Tsengwa, the president of the Minerals Council South Africa, said the industry had spent R2.3 billion on socio-economic development focusing largely on education and health.
Her observations pointed to a renaissance in the mining sector, particularly regarding critical minerals, which has invigorated the copper sector. Additionally, the chrome sector has seen remarkable success, setting new production records, showcasing the duality of growth and the ever-present need for safety.
Tsengwa also said communities were also beneficiaries of community benefit schemes, which derived revenue through dividend income from equity investments in mining companies.
“Despite constrained capacity to create more value, the mining industry has had a broad-based and positive impact on the economy, broader society, its employees and mine-host communities,” Tsengwa said.
“We have a rare opportunity presented to us as a country with our government of national unity and the positive spirit it engendered when it was formed. We cannot afford to squander this chance to revitalise our economy and uplift our people to dignified livelihoods.”
The event also saw Mxolisi Mgojo, the president of Business Unity South Africa, emphasising the necessity of long-term strategic visioning.
In his address on economic growth leadership, Mgojo suggested a 15-year planning horizon, urging the government to establish ambitious goals and the necessary frameworks to achieve them.
He welcomed the Transport Minister Barbara Creecy’s move to raise the Transnet board’s rail payload target from 210 million tons per annum to 250m tons, remarking that “thinking big” was essential for competing successfully on the global stage.
A panel discussion led by Bernard Swanepoel took a reflective look at the last two decades while forward-looking to the next. The discussion featured industry leaders such as former Minerals Council CEO Roger Baxter and Thandi Orleyn, chairperson of Impala Platinum.
The panel examined alarming statistics indicating that the mining industry’s contribution to South Africa’s economy has shrunk dramatically, from 11.1% in 1993 to a mere 4.8% in 2023. This decline is echoed by a falling share of global exploration budgets, dropping from 5.4% in 2004 to only 0.8% in 2022—a sobering reminder of the investments needed to reverse this trend.
Baxter emphasised the potential that lies in the mining sector, asserting that a modest annual growth of 3% over the next 15 years could double the economy, with mining playing a pivotal role in this recovery and expansion.
“Reflecting on the MPRDA, it did normalise and open up SA’s mining sector and led to the substantial transformation of the industry,“ Baxter said.
As South Africa grapples with foundational economic challenges, the collaborative insights and strategic direction expressed at the Indaba might just hold the keys to revitalising a sector critical not only to the nation’s energy future but to its overall economic resilience.
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