The Organisation Undoing Tax abuse (OUTA) has warned that the new electricity State of Disaster regulations could be used to allow a quick contract with Karpowerships and nuclear power deals by fast-tracking or bypassing environmental authorisations, procurement rules, public participation and legal challenges.
Outa, which has launched separate legal challenges in the Pretoria High Court to have the State of Disaster overturned and the National Energy Regulator of South Africa’s decision to grant licences to Turkey-owned Karpowerships reviewed and reversed, says it is concerned because a key aspect of the regulations aims to enable the connection of new generation power.
“OUTA is concerned that the Karpowerships contract, strongly promoted by Minister of Mineral Resources and Energy Gwede Mantashe in the face of civil society opposition, will now be fast-tracked through the system without the legally required due process,” OUTA said in a statement.
“We are concerned at the possibility that the regulations might be used to fast-track new nuclear power, also without the safeguards of existing law. These are the projects that ran into strong public opposition and should be subjected to careful, public scrutiny and meaningful public consultation, not enabled through late-night regulations under the guise of a ‘national disaster’ that has been 15 years in the making,” OUTA said.
OUTA said of particular concern were several clauses of Regulation 5(1) of the Disaster Management regulations that enable “streamlining and expediting application and decision-making procedures for regulatory processes related to energy generation projects, including designating a single department or institution to receive and coordinate the processing of applications or stipulating maximum timeframes for decision-making”. Regulation 5(1)(i) excludes “upgrades, refurbishments, adjustments and repairs of existing energy infrastructure and existing generation, transmission and distribution facilities” from all environmental law, while Regulation 5(1)(t)(3) permanently legalises all actions taken in terms of the regulations even after the state of disaster is lifted. OUTA said they effectively removed proper oversight, regulatory processes and public participation in decisions of enormous public importance and cost.
“This is the sign of a desperate government which seeks unfettered powers to pursue an agenda which is not in the public interest. We have the examples of Medupi and Kusile, where state capture, greed and mismanagement resulted in overspending on badly designed power stations, which have yet to deliver as promised but which bankrupted Eskom and resulted in last week’s R254 billion bailout by taxpayers. Lowering the standards of good governance is a sure way to foster increased corruption,” OUTA said.
The regulations also give wide powers to all ministers to “issue directions, as required, within his or her mandate”.
“It is not clear why all ministers would be granted these powers without a legal obligation to properly consult industry experts and Eskom itself, which are not mentioned in these regulations,” OUTA said.
OUTA said much of what Cabinet says the regulations are intended to achieve could have been done under existing law.
“There was nothing to prevent municipalities and provinces from arranging generators or back-ups for hospitals and water and sanitation infrastructure. Eskom has for years bought electricity from neighbouring states. It is odd that the notion that different government departments (and spheres of government) must suddenly cooperate in terms of a state of disaster, while cooperative government is a principle already enshrined in our Constitution,” OUTA said.
OUTA executive director, advocate Stefanie Fick said the government should rather make use of all the existing laws and emergency procurement regulations that are already at its disposal.
“We would like to see less political meddling or board interference in executive operational matters. The use of a state of disaster and these regulations is the last resort of a failed state,” Fick said.
OUTA’s legal challenge to the state of disaster, filed on 16 February 2023, is due to be heard in the Pretoria High Court on an expedited basis. This arises from an agreement between the parties that was made an order of court on Tuesday, 28 February.
It also filed an application for the review and setting aside of NERSA’s decisions to grant three Karpowership independent power producer (IPP) generation licences.
