ENERGY GOVERNANCE AND THE SOUTH AFRICAN DEVELOPMENTAL STATE

1. Introduction

Energy governance in South Africa is closely connected to the idea of the developmental state. A developmental state is one in which government does not merely regulate markets but actively shapes economic development, infrastructure investment, industrialisation, employment creation, redistribution, and social welfare.

Within this framework, energy is treated as a strategic public resource. Reliable and affordable electricity is essential for mining, manufacturing, transport, agriculture, digital infrastructure, housing, education, healthcare, and municipal services. Consequently, failures in the energy sector can directly weaken the state's developmental objectives.

South African energy governance therefore involves the interaction of:

State Ownership + Regulation + Constitutional Duties + Public Finance + Industrial Policy + Environmental Policy + Social Development

Eskom, municipalities, the National Energy Regulator of South Africa (NERSA), national government departments, independent power producers, courts, and environmental authorities all participate in this governance structure.

2. Meaning of the Developmental State

A developmental state seeks to use public institutions and economic policy to transform society.

In the South African context, this idea is influenced by the constitutional commitment to social and economic transformation. The Constitution envisages government as an active institution capable of correcting historical inequality and expanding access to basic services.

Energy policy is therefore not simply concerned with generating electricity. It forms part of a broader developmental programme involving:

electrification;

economic growth;

industrial development;

poverty reduction;

employment creation;

regional development;

infrastructure expansion; and

transformation of ownership structures.

Energy governance becomes an instrument through which constitutional and developmental objectives are implemented.

3. Eskom as a Developmental Institution

Eskom has historically occupied a central position in South Africa's developmental model.

As a state-owned enterprise, it has been responsible for large-scale electricity generation, transmission, and historically significant parts of distribution.

Its developmental role includes supplying electricity to:

Industry → Municipalities → Mines → Businesses → Households → Public Institutions

Through national electrification programmes, electricity infrastructure was expanded to millions of households that had previously lacked access.

However, Eskom's financial difficulties, ageing infrastructure, governance failures, maintenance problems, and electricity shortages demonstrate a central difficulty of the developmental-state model:

A developmental state requires capable public institutions.

If state-owned enterprises become financially or administratively unstable, developmental objectives may themselves become threatened.

4. Constitutional Basis of Developmental Energy Governance

The Constitution does not expressly recognise electricity as an independent fundamental right. Nevertheless, electricity supports numerous constitutional rights and governmental functions.

Electricity is essential for:

dignity;

healthcare;

education;

housing;

water services;

economic participation; and

municipal service delivery.

Sections dealing with cooperative government, municipalities, public administration, environmental rights, and socio-economic rights therefore indirectly influence energy governance.

The Constitution also requires public administration to operate according to principles of accountability, efficiency, transparency, and responsible use of public resources.

Thus, energy governance must satisfy both:

Developmental Objectives + Constitutional Accountability

5. Joseph v City of Johannesburg

Joseph and Others v City of Johannesburg and Others 2010 (4) SA 55 (CC)

This Constitutional Court case is fundamental to understanding electricity as a public service.

Residents of an apartment building had their electricity disconnected because the landlord had failed to pay the municipal account.

The residents themselves were not directly responsible for the debt.

The Constitutional Court recognised the importance of electricity within modern life and held that termination of municipal electricity supply could constitute administrative action requiring procedural fairness.

The case demonstrates that electricity governance cannot be reduced entirely to commercial relationships.

Where public institutions provide electricity, their decisions may affect constitutional interests and must comply with principles of lawful and fair administration.

For the developmental state, the case confirms that access to infrastructure must be governed through public-law values.

6. Vaal River Development Association v Eskom

Vaal River Development Association (Pty) Ltd v Eskom Holdings SOC Ltd 2023 (5) SA 225 (CC)

This case concerned severe electricity-supply restrictions associated with municipal indebtedness to Eskom.

The Constitutional Court confronted the conflict between Eskom's legitimate financial interests and the serious consequences that electricity interruptions could have for communities.

The case illustrates a fundamental developmental-state problem.

Municipalities may owe enormous debts to electricity suppliers, yet complete or severe interruption of electricity can damage:

businesses;

hospitals;

households;

water infrastructure;

schools; and

local economies.

Therefore:

Financial Sustainability must be balanced against Public-Service Continuity.

This tension lies at the centre of developmental energy governance.

7. NERSA and Developmental Regulation

National Energy Regulator of South Africa v PG Group (Pty) Ltd and Others 2020 (1) SA 450 (CC)

NERSA plays a central role in electricity pricing and regulation.

Tariff decisions are particularly important because electricity prices influence both social welfare and industrial competitiveness.

If tariffs are too low, electricity utilities may lack resources to maintain infrastructure.

If tariffs are excessively high, households may experience energy poverty while industries may reduce production or investment.

The constitutional litigation concerning NERSA illustrates that regulatory decisions must be lawful, rational, and consistent with statutory requirements.

Developmental regulation therefore requires a balance between:

Affordability + Utility Sustainability + Infrastructure Investment + Economic Competitiveness

8. Earthlife Africa Johannesburg v Minister of Environmental Affairs

Earthlife Africa Johannesburg v Minister of Environmental Affairs 2017 (2) All SA 519 (GP)

This case concerned environmental approval for the proposed Thabametsi coal-fired power station.

The High Court held that climate-change impacts were relevant considerations in environmental decision-making.

The judgment is important because developmental energy policy cannot pursue economic growth without considering environmental sustainability.

South Africa's developmental state must therefore increasingly combine:

Energy Security + Development + Climate Responsibility

The case represents the transition from a traditional industrial developmental model toward a more sustainable developmental state.

9. Energy Governance and Cooperative Government

Energy governance in South Africa is institutionally fragmented.

National government develops policy.

NERSA performs regulatory functions.

Eskom operates major electricity infrastructure.

Municipalities distribute electricity in many areas.

Private producers increasingly participate in generation.

This structure requires cooperative governance.

Conflict or institutional failure at one level can affect the entire electricity system.

For example:

Municipal Financial Failure → Non-Payment to Eskom → Supply Restrictions → Local Economic Damage → Reduced Municipal Revenue

This creates a self-reinforcing developmental crisis.

10. Renewable Energy and the New Developmental State

The emergence of renewable energy is transforming South Africa's developmental model.

Solar, wind, storage, distributed generation, and independent power production create new possibilities for:

energy diversification;

private investment;

employment;

local manufacturing;

reduced carbon emissions;

grid resilience; and

regional development.

The state's role is therefore changing from being predominantly an electricity producer toward becoming a planner, regulator, infrastructure coordinator, and market designer.

This does not necessarily weaken the developmental state. It may redefine it.

11. Just Energy Transition

South Africa's energy transition must also address employment and regional inequality.

Coal-dependent communities may face substantial economic disruption as the electricity sector decarbonises.

A developmental approach therefore requires a Just Energy Transition.

This means environmental reform should be accompanied by:

Worker Protection + Retraining + Regional Investment + New Industries + Social Support

The developmental state's responsibility is not merely to change energy technologies but to manage the social consequences of that transformation.

12. Conclusion

Energy governance is one of the clearest expressions of the South African developmental state because electricity infrastructure connects constitutional transformation with economic development.

Cases such as Joseph v City of Johannesburg, Vaal River Development Association v Eskom, NERSA v PG Group, and Earthlife Africa Johannesburg v Minister of Environmental Affairs demonstrate that energy governance involves far more than electricity generation.

It concerns administrative fairness, public-service continuity, financial sustainability, constitutional accountability, environmental protection, and economic transformation.

The central principle may therefore be stated as:

A developmental state cannot achieve social and economic transformation without a reliable, affordable, sustainable, and institutionally well-governed energy system.

Accordingly, South African energy law operates not merely as a technical regulatory field but as a central component of the country's broader constitutional and developmental project.