Ramaphosa’s energy portfolio shift stokes confusion
President Cyril Ramaphosa’s decision to move the critical energy portfolio out of Gwede Mantashe’s hands to fall under Kgosientsho Ramokgopa has given rise to immense uncertainty and confusion over how energy matters will be split across the two ministries.
Ramaphosa last week revealed his new, larger Cabinet, which seeks to accommodate all parties that make up South Africa’s new Government of National Unity (GNU).
The reappointment of Minister Gwede Mantashe came as no surprise, given the political heft he wields as secretary general of the African National Congress (ANC), but his portfolio has been streamlined from Mineral Resources and Energy to Mineral and Petroleum Resources.
Meanwhile, Kgosientsho Ramokgopa has been appointed minister of the newly merged department on electricity and energy.
Mantashe has vehemently denied he has been demoted in anyway – as had been suggested in local media coverage amid harsh criticism of his performance in his previous portfolio.
Speaking to McCloskey during a telephonic interview, Mantashe said he “loved” the new shape of his portfolio, which will allow him to give petroleum the attention it deserves.
Independent analyst Chris Yelland said the split in responsibilities across the two departments is very unclear.
Mantashe, however, said he had absolute clarity on how the responsibilities would be split, with only electricity-related energy matters falling to Ramokgopa’s department.
But this has stoked confusion among industry. “Where will NERSA [The National Energy Regulator South Africa] go? This cannot work,” said one prominent industry executive.
For now, some industry participants have assumed Ramokgopa will be responsible for a handful of critical tasks to ensure the country’s future energy security.
The Energy Intensive Users Group of SA (EIUG) – which counts major energy users like Anglo American, South32, Sasol, Glencore and Thungela Resources among its members – welcomed the establishment of the Electricity and Energy Ministry “as a policy maker and shareholder for Eskom during this rapidly transforming era”.
The group said Ramokgopa will urgently have to ensure that the Electricity Regulations Amendment Bill (ERA) — which establishes the framework for the liberalisation of South Africa’s electricity industry — is signed into law. He will also need to ensure that the Integrated Resources Plan (IRP) 2010-2030 is finalised.
Yelland expects Ramokgopa’s department will be responsible for the first draft of the Integrated Energy Plan (IEP), which must, by law, be produced by 30 March 2025.
The IEP is an overall energy plan for liquid fuels, gas and electricity, and is more detailed than the IRP.
In determining how responsibilities are split across the two ministries, stakeholders said it will also be key to see how the two departments will be resourced.
Private sector participants appear more welcoming of Ramokgopa, who has demonstrated dedication and enthusiasm in his post as minister of electricity.
He has been credited for his key role in addressing rotational power cuts, known as load shedding. Last weekend marked 100 consecutive days without loadshedding, a reprieve last enjoyed in late 2020.
Mantashe meanwhile has been criticised for frustrating the green power rollout and for the generally poor administration of his department, which has facilitated an inordinate backlog in processing mining rights application, serving as a major deterrent to new mining investment in the country.
Mantashe said the critics were not at the coal mines, noting that industry executives were pleased about his reappointment as a minister who understands the sector.
The Minerals Council South Africa CEO, Mzila Mthenjane, said Mantashe’s reappointment “gives continuity” in the engagements and relationship the industry has fostered with him over the years.
Mthenjane also welcomed the separation of the minerals and energy portfolios as it will allow Mantashe to focus on creating the right legislative environment to grow the mining industry.
“A priority for the mining industry in the seventh administration is the need to harmonise the regulatory requirements in various departments to expedite processing of rights to explore, build a mine or expand an existing operation,” Mthenjane said.
Of equal importance is the implementation of the mining cadastre, a digital platform to transparently and efficiently manage mineral right applications and licences, he said.
The Energy and Mining portfolio were previously split but were merged in 2019 under Mantashe, as part of Ramaphosa’s first government in a bid to reduce the size of Cabinet and the associated costs.