- A spat between Eskom CEO, Andre de Ruyter and the country’s Minister of Mineral Resources and Energy, Gwede Mantashe, over the DMRE not awarding Eskom a diesel import license, has spilled over into mainstream media.
- This has come in the wake of de Ruyters resignation after Mantashe accused Eskom of agitating to overthrow the state by not attending to loadshedding. Read more
- South African’s face up to six hours of power cuts daily.
- Eskom uses diesel power generation as backup power but last month ran out of funding to replenish reserves.
South Africa’s Department of Mineral Resources and Energy (DMRE) has noted an article published by News24 on 29 December 2022, titled: “Eskom can save billions with diesel import licence – but De Ruyter says progress with DMRE is slow,” and would like to provide the following clarity:
- For Eskom to buy directly from diesel importers of, they do not need a wholesale licence from DMRE. All oil companies operating in South Africa as well as other licensed importers can be approached for supply of diesel to Eskom at competitive prices.
- To import petroleum products directly, Eskom would need a licence including import infrastructure and adequate storage facilities which they currently do not have.
“With regards to claims that there is a potential saving of R6 per litre between the Basic Fuel Price and the Wholesale price, the DMRE would like to indicate that the R6 is mainly made up of taxes that the DMRE has no control over. However, if Eskom wants to be exempted from paying taxes which includes the Fuel Levy and Road Accident Fund Levy, Eskom should approach the relevant authorities.” – DMRE
The DMRE has confirmed that Eskom has applied for the diesel wholesale license, however it was not awarded since the application did not meet certain requirements, the details of which have been shared with Eskom as the applicant.
“As the per the legislated application process, Eskom can appeal the decision of the Controller of Petroleum Products to the Minister of Mineral Resources and Energy. That appeal has not been received by the Minister” – DMRE.
The DMRE remains available to discuss its concerns with Eskom as it does with all other applicants.
Author: Bryan Groenendaal