Hearings on the Delivery of Basic Household Energy Services

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Mineral Resources and Energy

08 November 2002
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THIS REPORT IS PRODUCED BY THE CONTACT TRUST

PORTFOLIO COMMITTEE MINERALS AND ENERGY
DATE:
09 NOVEMBER 2002
HEARINGS ON THE DELIVERY OF BASIC HOUSEHOLD ENERGY SERVICES
CHAIR:
Mr M Goniwe

SUMMARY:
Presentations were made by the Energy and Development Research Centre, the Minerals and Energy Policy Centre and groundWork. Communities presented their problems relating to the solar homes' systems in their areas. In response to this, members informed them that they should not ignore all that government has done in order to improve the lives of people. The Chair however informed members that the issue being discussed was sensitive and that comments being made by presenters, should not be construed in a negative light

Presentation by EDRC- Eastern Cape (excel file)
Energy Use-EDRC ( Excel file)
How do SHS address the basic needs of rural communities?
e-mail info@pmg.org.za for the following document
Energy Poverty & Policy: Bridging implementation gap

Address by the Chairperson

The Chairperson stated that the purpose of bringing people to parliament for this workshop was to give effect to the notion of a 'People's Assembly'. Organisations presenting would be able to play a role in policy-making. NGO's, community-based organisations and civil society would brief the Committee on how they perceived certain important issues. The topic of the workshops (delivery of basic household energy services) was a serious barrier in the lives of ordinary people. The Committee would hopefully be able to assist these organisations where possible, in order to guarantee quality service delivery. The presenters came from backgrounds ranging from intellectual (and well-resourced) organisations to grassroots organisations.

The Chairperson suggested that presenters should present their ideas without considering the members' opinions and views. They should put forward concise recommendations.

Perhaps the Committee should invite those in the frontline of service delivery (e.g. Eskom) to come and determine the best way to solve grievances

Presentation by the EDRC

Mr Y Afrane-Okese stated that solar home systems had been delivered to various rural communities. The EDRC has brought representatives from the rural areas to discuss their experiences with regard to the solar home systems.

At WSSD there had been very strong support for off-grid electrification. SA has been using solar home systems to deliver in this regard. This was done by government granting concessions to five companies, which it then subsidises with R3500.00 per solar system. This would include the installation of the solar system, as well as its maintenance for a period of twenty years. The owner contributes to any cost exceeding the R3500.00.

He stated that presentations would focus on solar systems and how they related to:
- Poverty Alleviation
- Productive activity/income creation
- Lessen burden of women
- Health benefits
- Local environmental benefits
- Job creation
- Media access
- Basic needs

Refer to the document for further detail.

Mr Afrane-Okese introduced the presenters who had come from the rural areas to relate their experiences. They were: Trevor Mudzanani and Chief Folovhodwe (Northern Cape), Duncan Mafunda (Eastern Cape) and Sakhile Mthembu (KZN).

Presentation by the Magadla Energy Committee (Eastern Cape)

Mr D Mafunda stated that Magadla is a very disadvantaged community with a high unemployment rate.

The service provider (responsible for providing their solar systems) was Eskom-Shell. Persons installing the systems were limited to four technicians and one manager. They commended government for providing solar energy. Earlier this year persons interested in having solar energy in their homes were asked to contribute R120.00 to their installation. Upon learning that government had contributed R3500.00, parts of the community felt that government could actually have provided the system for free. Another problem is that only persons with monthly incomes could afford the system, hereby causing a rift between the 'haves' and have-nots'.

The community had been promised that their systems would be upgraded in August this year to allow for activities like refrigeration, cooking and cleaning. This has not happened.

One of the biggest problems faced by the community was the fact that failure to pay for three months results in the panel being disconnected. Once disconnected, the monthly installment still has to be paid every month. This is unfair since persons who have been disconnected from the grid are not expected to pay for the months that they are not using electricity.

While they were grateful to Eskom-Shell for making these systems available, they felt that government should have invested the R3500 to benefit everyone without electricity and not just a few. Because of the limitations of the systems women still have to walk for about five kilometres to fetch firewood. When the systems were introduced scholars were employed to assist in their installation. They were promised jobs upon completion of the project. This has never been delivered. There is still much reliance on traditional fuels, which are extremely dangerous.

Another problem has been that service complaints could take about two weeks to be dealt with. Also systems are very limited in that they do not allow for the simultaneous use of lights and radio. The presenter urged service-providers to take the time to visit the communities to determine what the problems are. He appealed to government to consider the Magadla community when examining the problem of lack of delivery of basic energy services

Presentation by the Duvuledza Community Development Committee

Mr T Mudzanani stated that the nearest town to Duvuledza is about 90km away. Their service provider is Solar Vision, whose offices are 180 km away from their community. Solar Vision provides households with one panel, one battery and four lights at an installation cost of R100.00 and a monthly fee of R58.00. The company uses the Chief to collect this money. Solar Vision has installed 50 panels and has to date removed five owing to inability to afford the monthly fee. Contrary to the promises made by Solar Vision, the system did not address basic needs of the households, since it merely provided lights, black and white television and radio. The system does not work during cloudy months, yet the monthly fee of R58.00 remains payable. He asked how the community could be expected to pay so much for a service, which is so inadequate. The payment of R10.00 or R20.00 would be more appropriate.

In addition the community had expected the installation of the systems to reduce the burden of women, yet women are still walking between five and six kilometers to collect firewood. The community had expected the installation of the systems to create jobs-thus far there have been none, since persons rendering services are existing employees of the company.

Mr Mudzanani emphasized that the introduction of solar systems into the community was not necessarily a negative thing. Children are now able to study until after dark. They are able to watch black and white television and listen to their portable radios. He said that payment of R58.00 for such inadequate service was proving to be burden to the community

Presentation by the EDRC- KZN Representative

Mr Sakhile Mthembu stated that their community is situated in the far North of KZN. They were provided with one panel, one battery and four lights (three for indoors and one for outdoors). The community, which is very poor, has not been electrified yet despite promises that everyone would receive electricity by June 2002. Upon hearing about the possibility of solar systems people applied in large numbers, since they had been under the impression that the systems would provide energy for cooking, refrigeration and a colour TV. They were surprised to learn of its limitations. In addition the system was not available to everyone, since it excluded everyone without a regular income who could not pay the monthly fee of R58.00.

For those who do own the systems the company is slow in responding to queries and reports of faulty systems. It did not manage to ease the burden of the communities, since people still have to buy candles, fill gas cylinders and collect firewood. The inability to community to communicate with the company is a big problem. The company has promised to send people to assist with problems. This has not happened. Persons who then wished to go to the offices of the company to address the problems, would have to pay about R24.00 for return trips. They then still have to pay the monthly R58.00. Very often trips to the company's offices sometimes have to be repeated in order to remind the company of the query, to which they often did not attend. The company also failed to employ anyone from the community.

Mr Mthembu however stated that the company has assisted the community in many ways, since it gave the community access to brighter lights and therefore enabled students to study for longer periods of time. They are able to watch black and white TV and to listen to the radio.

Another problem is that panels often get stolen. The alarms, which are installed in the systems are so soft that they are not able to alert one when a theft occurs. Theft then leads to violence, as revenge attacks take place.

Mr Mthembu suggested that the quality of the solar home systems should be improved so as to enable households to cook, use a fridge and a colour television. Government should perhaps introduce a programme whereby the quality of the systems are monitored in order to ensure that they meet the needs of the people. Alternatively, government should then provide the community with access to grid electricity

Presentation by Folovhodwe Tribal Council

The Chief stated that the situation in his tribal village was different to those described above. Whereas the systems described in earlier presentations had been provided by concession companies, his village had received them as part of a donor project.

In 1998 the village had been used as a pilot project. In terms of this project the entire village had been electrified by supplying 582 panels. The Chief stated that he was an educator in a high school in which 26 panels had been installed. A higher primary school had been given 15 panels while the lower school had been provided with six.

Government, upon introducing the systems to the village had said that they would be free since the Bavarian Government had provided them. In 1999, after the installation of the systems, they were informed that they would have to pay a service fee of R35.00. After persuading people to pay, they agreed to pay R20.00. There were however problems with some of the panels, which were of such a poor quality that they collapsed after six months. Theft of panels is also a big problem. At one stage 220 panels had been stolen. Upon the arrest of the perpetrators earlier this year they discovered that the technicians who had installed the systems had in fact stolen them back in order to re-sell them. Another problem is that replacement materials (lights and battery) are not readily available. People have decided not to pay for the systems and there are now 135 systems which have been disconnected. On 9 August 2002 people decided that they would cease payment. Some of them are using conventional electricity now. Previously Folovhodwe had merely been some town 'in the bush'. In 1999/2000 their school had an impressive pass rate. They fear that this would not be possible again this year since only two of their eight classes have lights. Of the entire 26 panels provided to the school, none had ever worked. In addition the installation of these systems have never created employment, since one technician services all the systems.

Women are still collecting firewood. Despite the fact that there are pipes there is no electricity to pump water from the river. Thus women still have to collect water.
Access to media is acceptable, since people now have energy for radio's and computers

Questions and Discussion

The Chair said that members of the Department of Minerals and Energy were present and they would therefore be able to communicate these problems to the Department. The Committee would then follow up on how the Department was addressing these issues. It may also be necessary for the Committee to visit these areas in order to determine the nature of the problems for themselves.

Mr Afrane-Okese stated that there is a need for creative solutions. The National Electricity Regulator is supposed to monitor the electricity provision in these areas regularly, yet they only receive a consultant from time to time. There are supposed to be government structures that can inform people as to the service they will be getting. Instead it is the service provider that performs this task. An independent party should provide people with this information in order to ensure that they are aware of the limitations of the systems.

Mr Ngcobo made two comments: Firstly, he stated that these energy options did not provide total solutions. Often they have to be coupled with grid systems. On the one hand there are problems with the solar systems, e.g. they do not operate in the absence of sun. On the other hand the cost of maintaining the grid is expensive. Secondly, he commented on the unscrupulous nature of some of the concessionaries. Although government had good intentions in allowing these concessions, the companies' main focus was profit. He suggested that the Committee should discuss a means of monitoring this.

Mr S Louw (ANC) reiterated the fact that one should not ignore government's good intentions. The Committee should at some stage invite the service providers, the South African Local Government Association and other stakeholders in order to discuss ways in which the service providers could beef up the systems.

Prof I Mohamed (ANC) stated that government has done so much to address the needs of the people. He described the days when he was growing up in the Eastern Cape and how they had suffered without electricity. There had been no option of solar systems. He pointed out that SA has come a long way and that one should not diminish the genuine attempts made by government.

Ms N Cindi (ANC) reminded the presenters that government has been elected by the people and for the people. She referred to the R11 000 which had been given to the Chief for a building (see document) and asked who monitored the spending of this money. In addition when the building was built, that must surely have created some employment. Members already knew that companies were just after profits. They do however want to know how the members of the communities themselves are monitoring funds.

The Chair intervened, saying that presenters had come to share their practical experiences. The issue of household energy is very sensitive. He stated that he had not interpreted anything from the presentations. The problems raised were practical issues. There was someone from the Department taking note of the issues raised. In addition the Committee too was doing its bit. They wanted a speedy response and co-operation in order to find solutions. He stated that, while government has attempted to deal with the problems, they still fall short in terms of actually addressing the issues. One has to bear in mind that Government is under serious pressure from lobbyists, especially with regard to the issue of sustainable energy. Addressing the question to the National Electricity Regulator, he asked why the Department has still not managed to provide so many people with electricity.

Ms L Ferrando (Senior Financial Analyst of the National Electricity Regulator) responded that the R3500.00 still does not fully cover the cost of installation in each area. It is for this reason that the additional monthly fee is needed

Presentation by the Minerals and Energy Policy Centre

Mr M Mehlwana stated that much of what he wanted to say had already been covered in previous presentations. He believed that Government was moving in the right direction in terms of service delivery.

His presentation was aimed at placing a 'cat among the pigeons'.
He stated that the need is not for electricity per se, but for the service it provides. Likewise, it is not fuel per se which is required, but energy conversion.

He pointed out that in calculating the cost of energy, one often does not consider the health costs. No one considers the fact that Government spends approximately R3m per annum to combat respiratory diseases. As mentioned by previous presenters, there is still the need for women to collect firewood.

Mr Mehlwana stated that solar PV was not an option for the poorest of the poor. A renewable energy strategy can only be successful if it addresses the needs of SMMEs. This is because the strategy must support economic activity.

Mr Mehlwana read through his presentation document, which fully explained the concepts of energy poverty, the implementation of sustainable energy, renewable energy options and provides possible solutions

Questions and Discussion

Prof Mohamed stated that there were in fact metal solar panels, which transmitted energy efficiently. However these are very expensive and persons involved have not managed to raise local funding. In addition very little research has been done on this- at University of the Western Cape and abroad.

Mr Ncobo stated that while it is important to focus on the development of renewable energy policy and technology one should not overlook the basic needs of the people. This can be addressed by extending existing power stations and boilers to communities (as they do abroad). Renewable energy and technology have to focus on giving services, whether this is by wind, sun etc

Mr Mehlwana responded that it was important to harmonise grid and non-grid. In SA there are plans afoot to sell non-grid electricity to the grid by virtue of Independent Power Producers. However, his presentation had focused on the smaller users of electricity.

Presentation by Groundwork

Mr A Soeker (Air Quality Project Co-ordinator for groundWork) stated that he worked with communities living next to polluting industries in South Durban, Sasolburg, Secunda and Tableview.

The presentation focused on Sasolburg. In this community households relied heavily on coal for their heating and cooking requirements. The burning of coal releases various pollutants and heavy minerals into the air.

Sasol has now introduced a natural gas, which is a cleaner energy source than coal into their operations in Secunda and Sasolburg.

While Sasolburgs experiences the worst chemical pollution experienced by the industry, they benefit the least in terms of jobs and profits made by the industries. The illnesses faced by the communities impoverish them further, since they are unable to afford the medical treatment required. Sasol continuously deflects attention away from its own pollution, saying that the pollution is caused by the fact that the communities burn coal.

In one air sample taken in Zamdela, 36 different chemicals were found including Benzene, a known carcinogen and methyl chloride.

groundWork calls on Government to ensure that companies like Sasol move away from coal-based energy. Communities ask why they are unable to benefit directly from gas an an energy source.

Ms S Ntaopane (Sasolburg Environmental Committee) stated that pollution in Zamdela is really bad. Black communities have been using coal for a long time without knowing the harm it can cause to their health.

Despite the long running electrification programme reliance on coal persists because people are unable to afford electricity for heating and cooking. The problem can be dealt with by opening up the channels of communication between big companies, Government and communities.

Coal can be replaced by natural gas, which Sasol is bringing into its plants in Secunda and Sasolburg. Communities should be provided with this natural gas to supplement electricity. This should be done at affordable prices so that the poor too can benefit.

Social and economic development should go hand in hand with environmental protection. Very few jobs are provided and there is little improvements resulting from the developments in these communities

Address by the Chair

The Chair thanked Contact Trust for facilitating the process of enabling the various communities to access Parliament. The members would now examine the submissions and extract the key issues. This would however be the final meeting of the Committee for 2003.

The concept of household energy is vital to the Committee's programme. He thanked the Department, the National Electricity Regulator and the public and stated that the parties would work together to find workable solutions

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