South Africa’s mining directors did not act fast enough in response to the country’s energy challenges. That’s according to Thomas Garner, CEO of Cennergi, an independent power producer.
Participating in a panel discussion about the energy crisis and changing energy mix at the Joburg Indaba, Garner said the stability of the country’s electricity supply had been flagged as a risk since the mid-2000s: “We predicted that electricity prices would treble and no one believed us”. At that stage, electricity was never listed as a massive risk or even one of the top five risks to industrialisation in South Africa due to Eskom’s reliability and the fact that it was cheap to buy electricity from the utility, he said. And this, according to him, raises questions as to how directors with fiduciary responsibilities make decisions.
But fellow panelist and energy thought leader Mike Rossouw said the fact that “nobody knows what energy demand is going to be in the future” has profound implications for investing in growth. Calling for increased transparency, he said not being able to predict the price of energy is the biggest challenge to the mining industry. However, unlike traditional energy forms, renewable energy prices can be predicted.
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Participating in a panel discussion about the energy crisis and changing energy mix at the Joburg Indaba, Garner said the stability of the country’s electricity supply had been flagged as a risk since the mid-2000s: “We predicted that electricity prices would treble and no one believed us”. At that stage, electricity was never listed as a massive risk or even one of the top five risks to industrialisation in South Africa due to Eskom’s reliability and the fact that it was cheap to buy electricity from the utility, he said. And this, according to him, raises questions as to how directors with fiduciary responsibilities make decisions.
But fellow panelist and energy thought leader Mike Rossouw said the fact that “nobody knows what energy demand is going to be in the future” has profound implications for investing in growth. Calling for increased transparency, he said not being able to predict the price of energy is the biggest challenge to the mining industry. However, unlike traditional energy forms, renewable energy prices can be predicted.
Read more......
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