Südafrike : January 24, 2011

South Africa’s Energy Regulator’s (NERSA) Chief Executive Officer had recently been suspended from his position for alleged transgressions of NERSA’s code of conduct.  Various media have reported that one of the transgressions being investigated includes alleged public drunkenness.

At the time, pending the outcome of NERSA’s internal investigation, an interim CEO had been appointed.  However, after only ten days into the investigation NERSA’s board decided to reinstate the CEO advising that the allegations against him were handed over to the Government’s Minster of Energy for further action.  The role of the Minister of Energy is to appoint board members and designate chairpersons of the NERSA.  Thus, the Board may recommend a candidate for the position of CEO to the Minister of Energy with the final appointment being at the discretion of the Minister.

The Minister of Energy may terminate the appointment of the Board members and CEO under specified criteria.  Some legal experts have proposed that the definition of “undue influence” could be extended to include being under the undue influence of alcohol.  Of course, putting aside any legal wrangling, it is expected that the CEO of the Regulator be competent and a person of a clear mind when making decisions regarding the country’s energy industry.

The involvement of the Minister of Energy at this juncture coupled with the inconsistency in the handling of this serious matter gives rise to public suspicion that politics is influencing the investigation.  Considering that NERSA is an appointed statutory body established to make independent and unbiased decisions in the electricity, gas and petroleum pipeline industries, any charge of political influence into a regulatory agency could have serious repercussions – not the least having NERSA’s creditability being called into question.