OUTA Goes to Court to Overturn the Electricity State of Disaster in South Africa

  • The Organisation Undoing Tax Abuse (OUTA) is bringing an urgent application against the government to overturn the national state of disaster in connection with the electricity supply constraints. 
  • The application was filed in the Pretoria High Court on Thursday 16 February 2023. 
  • The state of disaster was announced by President Cyril Ramaphosa on 8 February in his State of the Nation Address (see here) and two notices related to it were gazetted the same day (the classification of the disaster is here and the declaration of the disaster is here).

Why OUTA is bringing this application

OUTA believes the decision to declare the disaster was irrational, arbitrary and unlawful.

It is the result of a crisis created by the government itself which has been more than 15 years in the making. It is unnecessary because laws already exist to enable urgent action to address the energy crisis.

“Years of state capture, mismanagement and a dysfunctional culture cannot be a rational justification for the declaration of a national state of disaster,” says Advocate Stefanie Fick, OUTA Executive Director.

The state of disaster grants extraordinary powers to officials to make far-reaching decisions without parliamentary oversight, which is a real concern in the light of the extensive looting enabled by emergency procurement during the Covid-19 state of disaster.

“If the decision to declare a national state of disaster due to this self-created crisis by the Government is allowed to stand, it will open the floodgates for further such disasters to be declared in various other sectors that suffered from similar dysfunction, mismanagement, and corruption. Declaring a national state of disaster will in effect become a tool for the Government to circumvent accountability and hide behind the excuse of a disaster to reach an apparent ‘quick-fix’ for problems that were years in the making,” says Fick.

“We are bringing this application because OUTA will not stand by when government grants itself extraordinary powers with reduced oversight to deal with a self-created energy crisis.”

The application

This is an urgent application to review and set aside the decisions to classify the electricity constraints as a national disaster and to declare the national state of disaster.

The case number in the Pretoria High Court is 2023/014861.

OUTA is bringing the application against:

  1. The President, who announced the national state of disaster;
  2. The head of the National Disaster Management Centre (NDMC), who classified the electricity crisis as a disaster;
  3. The Minister for Cooperative Governance and Traditional Affairs, who declared the national state of disaster;
  4. The Minister of Mineral Resources and Energy;
  5. The Minister of Public Enterprises;
  6. The Speaker of the National Assembly;
  7. The Chairperson of the National Council of Provinces; and
  8. Eskom Holdings.

The sixth to eighth respondents are cited as interested parties and no relief is sought against them unless they oppose the application.

The application has two parts. Part A asks the court to interdict the first five respondents from taking any further steps or issuing or implementing any regulations in terms of the disaster decisions pending the finalisation of the second part.

Part B asks the court to review the decisions and set aside the classification of the electricity crisis as a disaster and the declaration of a national state of disaster. The decisions fall within the definition of “administrative action” as set out in the Promotion of Administrative Justice Act, which allows for the judicial review of such action.

As this is an application for a review, the notice of motion also asks that the head of the NDMC and the COGTA Minister to provide within 15 days the records of all documents and all electronic records relating to the making of the decisions and the reasons for the decisions. This is called for in terms of the rules of court.

The founding affidavit

The application is supported by a founding affidavit by OUTA’s Advocate Fick.

Fick’s affidavit points out that South Africa was warned of upcoming energy constraints as early as 1998 and has had loadshedding since 2008, so the difficulties with supply are not new.

“There is no indication whatsoever that the declaration of a state of national disaster will make any difference to the situation, other than to open up the procurement process and method of delivery to a potential new wave of corruption similar to what was seen during the Covid-19 national state of disaster,” says Fick in the affidavit.

“Moreover, the crisis was caused by the Government who now seeks to rely on its own mismanagement of the national power grid in the past consisting inter alia of years of a lack of maintenance of the power plants, the devastating effects of state capture and the failure to deal with the pervasive corruption and theft at several power stations as justification for the declaration for the state of emergency. These aspects were all referred to by the first respondent [the President]in his State of the Nation address on 9 February 2023.”

This is why the state of disaster is not needed:

  1. The Disaster Management Act (DMA) says disasters do not include occurrences which can be dealt with effectively in terms of other national legislation. Existing legislation is available to deal effectively with emergency electricity procurement.

The Electricity Regulation Act allows the Minister of Mineral Resources and Energy to enter into agreements for new generation capacity, including emergency supply of power.

The National Energy Act allows the Minister of Mineral Resources and Energy to acquire, maintain, monitor and manage national strategic energy feedstocks and carriers, and to direct any state-owned entity (SOE) to do this, including deciding the mechanism for paying for this. This Act also allows this minister to direct any SOE to invest in and maintain energy infrastructure.

The Public Finance Management Act provides for the use of funds in emergency situations, authorised by the Minister of Finance.

  1. There is already an Energy Action Plan, announced by the President in July 2022, developed through extensive consultation and endorsed by energy experts as the best and fastest path to energy security. At the time, the President said this plan was preferable to declaring a state of disaster. The National Energy Crisis Committee (NECOM) was established to oversee this plan and published an update report in January 2023 listing achievements and with no mention of an imminent national disaster. “It is evident from the Energy Action Plan and the subsequent NECOM update report that contingency arrangements have already been put in place to adequately deal with the energy crisis, and that there is a clear plan to end loadshedding that does not require the declaration of a state of disaster,” says Fick. OUTA supports this plan and believes it is the only way out of the crisis.
  2. The Integrated Resource Plan (IRP) of 2019 is “yet another plan that was published by the Government with proposed solutions for the electricity demand which did not lead to a resolving of the crisis”. Government “should start efficiently implementing the existing plans instead of continuously introducing new plans that bear little fruit,” says Fick.
  3. A state of disaster cannot be declared on pure speculation of a blackout. The decisions refer to the need to prevent a possible “total blackout” from occurring, but there is no evidence that a total blackout will occur. “Only once the disaster has occurred, the potential magnitude and severity thereof may be taken into account. People and communities in South Africa have been affected by the electricity shortage for over 15 years. It is submitted that this could not overnight transform into a national disaster,” says Fick. On 22 January, Eskom said in a media statement that even though the stages of loadshedding had been high and over extended periods, “there is no higher risk of a blackout than normal”.
  4. Eskom does not appear to have been consulted about the need for a state of disaster, and seemed to be in the dark about it when it was announced. In a presentation to Parliament two days before the President’s announcement, Eskom made no mention of the need for a state of disaster but instead said the most viable short-term solution was to find funds to run the diesel-powered generators and to relax some of the procurement requirements to speed up procurement, neither of which require the state of disaster.
  5. There is no indication of what the government intends to do differently that requires a state of disaster.
  6. OUTA is concerned that the Minister of Mineral Resources and Energy will use the excuse of a state of disaster to justify an emergency contract with Karpowership. OUTA is currently involved in litigation to overturn the Karpowership generation licences (see here). A key point of dispute in this challenge is the cost of these projects to taxpayers and electricity consumers, which OUTA believes is being hidden, and OUTA is concerned that the Minister will use the state of disaster to circumvent the pending review proceedings and enable emergency Karpowership contracts.
  7. A state of disaster may be used to fast-track reckless and environmentally harmful procurement with reduced oversight. Under a national state of disaster, fast-tracking of procurement is available to all departments. The Covid-19 national state of disaster showed how many authorities and businesses took advantage of the relaxation of rules and oversight, and how even real-time auditing by the Auditor-General could not prevent the widespread abuse. The reduction in oversight is an invitation to corruption.
  8. There is no evidence that a state of disaster will make any difference whatsoever, as the announcement was not coupled with any tangible proof of differences that would occur. Over the years, government has produced various plans to address the current energy crisis, however none of these have gone far enough to alleviate it, largely due to lack of implementation.

OUTA believes that the electricity crisis which South Africa has struggled with for more than 15 years could not overnight transform into a national disaster. They have very real concerns that the state of disaster will be used to abuse powers and enable large-scale looting, but will not help resolve the electricity crisis. This is why they are challenging it.

Author: Bryan Groenendaal

Source: OUTA 

Leave A Reply

About Author

Green Building Africa promotes the need for net carbon zero buildings and cities in Africa. We are fiercely independent and encourage outlying thinkers to contribute to the #netcarbonzero movement. Climate change is upon us and now is the time to react in a more diverse and broader approach to sustainability in the built environment. We challenge architects, property developers, urban planners, renewable energy professionals and green building specialists. We also challenge the funding houses and regulators and the role they play in facilitating investment into green projects. Lastly, we explore and investigate new technology and real-time data to speed up the journey in realising a net carbon zero environment for our children.

Copyright Green Building Africa 2024.