Ramaphosa Fires Deputy Minister, Straining South African Coalition
South African President Cyril Ramaphosa fired a deputy minister from the second-largest party in the ruling coalition on Thursday, a move that renews strain on the stability of his administration.
Ramaphosa dismissed Deputy Trade, Industry and Competition Minister Andrew Whitfield of the Democratic Alliance without providing reasons for his removal. The party's leader John Steenhuisen said Whitfield was axed because he traveled abroad after the president failed to respond to his request to go, yet members of Ramaphosa's Africa National Congress retained their cabinet posts despite having been implicated in looting and corruption.
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News24
30 minutes ago
- News24
The hidden cost of Eskom's electricity deals with smelters
A fierce debate has erupted over the preferential electricity pricing deals – known as Negotiated Pricing Agreements – that Eskom has struck with major industrial users like South32's Hillside aluminium smelter and ferrochrome producers, writes Chris Yelland for EE Business Intelligence. Government insists these deals are vital to protect jobs and exports, but critics say they lack transparency, impose costs on other customers and ordinary consumers, and contradict the principles of a fair and competitive electricity market. Hillside: South Africa's 'congealed electricity' South32's Hillside Aluminium smelter in Richards Bay is one of the largest of its kind globally, and a cornerstone of South Africa's aluminium industry. With no local bauxite reserves, Hillside relies on imported feedstock and vast amounts of electricity – 10.3 TWh per year, around 5.6% of Eskom's total sales. Under the 10-year NPA approved by NERSA in 2021, Hillside pays a discounted rate for electricity that currently amounts to around R10 billion per year less than it would pay on Eskom's standard Megaflex tariff for mines and large industry. The effective discount over the life of the agreement is about 50%. Interruptability vs. affordability Eskom justifies this discount by pointing to Hillside's role in stabilising the grid. The smelter's operations can be interrupted briefly during supply shortfalls, providing a form of demand-side flexibility that Eskom can use instead of reserve generation. But according to a recent and critical analysis by Meridian Economics, this function could be replicated – more cheaply – using 1.2 GW of two-hour battery energy storage. Using current battery procurement prices from the IPP Office, such a solution would cost less than R3 billion per year, suggesting a net discount of R7 billion annually to Hillside. The case for socioeconomic value Supporters of the NPA argue it helps preserve jobs and downstream aluminium beneficiation. Hillside employs about 1 800 workers directly and supplies 27% of its output domestically. But critics say this argument is based on false binaries – that without the NPA, the smelter would close and jobs would vanish. Instead, the electricity used at Hillside could be reallocated to smaller businesses, potentially yielding broader and more resilient economic benefits. The real question, then, is not whether Hillside provides value – but whether that value exceeds what other sectors could generate with the same power. NERSA and the fog of regulation The National Energy Regulator of South Africa (NERSA) approved the Hillside NPA in 2021, but the process was opaque. The decision lacked detailed economic modelling, failed to evaluate alternatives like battery storage, and made no attempt to compare Hillside's benefit to that of alternative electricity uses. It would further appear that no other party in South Africa has done a proper economic analysis and calculation of the real socioeconomic benefits of the Hillside NPA. Furthermore, key economic inputs – like the pricing escalation clause and aluminium price 'upside' mechanisms – were based on unclear rationale. Although the NPA was touted as free of embedded derivatives, Meridian Economics argues that a call-option structure remains embedded in the deal. Cabinet's broader move: more NPAs are coming In a related development, Cabinet has just approved a framework to extend NPAs to South Africa's ferrochrome and alloys smelters – long-time industrial electricity users struggling with soaring electricity tariffs. According to Energy & Electricity Minister Kgosientsho Ramokgopa, the aim is to protect energy-intensive exporters and maintain South Africa's industrial base. But this raises more questions than answers: Are these deals being driven by sound economic analysis and proper power planning, or by ad hoc industrial policy dressed up as regulation? A system at odds with reform Eskom is in financial distress. Other customers – particularly households and SMEs – are paying ever-higher prices for less reliable power. Load shedding, grid instability and rising tariffs have become hallmarks of the crisis. And yet, one of Eskom's biggest customers pays half-price for electricity – a situation kept under wraps until civil society group Open Secrets forced publication of the full Hillside NPA. That it took four years for civil society to scrutinise the deal signals how deeply broken the oversight processes are. Towards a transparent future The principle of cross-subsidisation can be legitimate – but only when clearly justified. Preferential electricity pricing must be scrutinised like any public subsidy: through open modelling, public hearings and clear metrics of cost-benefit. Right now, that is not happening. Eskom, NERSA and the Ministry of Energy & Electricity must explain why energy-intensive smelters deserve these deals – and why other commercial, industrial, manufacturing and mining customers and ordinary consumers should foot the bill. Without that, NPAs risk entrenching elite privilege at the expense of national equity, economic dynamism, and the future of South Africa's energy system. Chris Yelland is managing director, EE Business Intelligence. This article was first published by EE Business Intelligence (Pty) Ltd and may not be published without the written permission of EE Business Intelligence. References 1. – Meridian Economics Briefing Note, June 2025. 2. Cabinet approves discounted electricity prices for ferrochrome and alloys – by Linda Ensor, Business Day, 25 June 2025. 3. Cabinet unveils plans for chrome tax as Ramokgopa defends plans to save SA's smelters – by Na'ilah Ebrahim, News24, 25 June 2025.
Wall Street Journal
an hour ago
- Wall Street Journal
Mamdani Is as Extreme as Trump
Democrats rightly deplore the Republican Party for capitulating to Donald Trump and an agenda that threatens democracy and decency. But we'd better pause and note how our own party is creeping dangerously close to an agenda that's equally outlandish and radical. The clearest sign is the victory by Zohran Mamdani in the Democratic primary for mayor of New York. His endorsers included Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez.
Gizmodo
an hour ago
- Gizmodo
Peter Thiel Says Elon Musk Doesn't Understand His Own Robot Revolution
Far-right tech investor Peter Thiel sat down for an interview with the New York Times' Ross Douthat and talked about the billionaire's recent political escapades and the future of humanity. Thiel also discussed his thoughts on the Antichrist, a topic that the Times chose to highlight, giving the written version of the interview the salacious headline, 'Peter Thiel and the Antichrist.' But it was Thiel's thoughts on his friend Elon Musk that were arguably the most illuminating for those of us interested in the current collision of politics, business, and tech—especially since Thiel suggested Musk doesn't actually believe in a lot of what he's saying. Either that, or Musk just isn't very bright, another possibility Thiel subtly suggested was on the table. Ever since Musk debuted his 'robot' in 2021, which was actually just a person in a robot costume, the Tesla CEO has been hyping the idea that everyone would eventually have a personal humanoid robot in their home. In fact, Musk thinks these robots will be so popular that there will be a billion of them in the U.S. within 10 years. But Thiel believes that if that's actually going to happen, Musk is worrying about the wrong things when it comes to his politics. Musk is obsessed with budget deficits and has held up America's debt as one of the main reasons he supported Donald Trump in the 2024 presidential election, tossing at least a quarter of a billion dollars into the race. Well, there was the debt and Musk's other passion projects, like demonizing trans people and immigrants. But the debt was definitely a high priority for Musk. Thiel told the New York Times he thought that if Musk really believed in his robot revolution, the deficit would take care of itself. I had a conversation with Elon a few weeks ago about this. He said we're going to have a billion humanoid robots in the U.S. in 10 years. And I said: Well, if that's true, you don't need to worry about the budget deficits because we're going to have so much growth, the growth will take care of this. And then — well, he's still worried about the budget deficits. This doesn't prove that he doesn't believe in the billion robots, but it suggests that maybe he hasn't thought it through or that he doesn't think it's going to be as transformative economically, or that there are big error bars around it. But yeah, there's some way in which these things are not quite thought through. Thiel's view is actually pretty common in Silicon Valley, though it's never phrased in quite that way. The guys on the All-In podcast, for example, are all friends with Musk as well and similarly talk about how growth is going to take care of budget deficits. The difference is that they talk about it as a way to rationalize their support for tax cuts while insisting they're deficit hawks. Trump's so-called 'Big Beautiful Bill' is going to increase the deficit by $2.4 trillion, according to the non-partisan Congressional Budget Office, largely because it's giving tax cuts skewed to older people and the wealthy. But the All-In bros think the growth in AI will fix it all while also insisting deficits will bankrupt the economy. But Thiel is taking a slightly different angle on his version of our robot-filled future, and it's one that anyone who's being intellectually honest should take seriously. If robots are really going to deliver this revolutionary productivity, a future where we're all just sitting around while robots do the work for us, why are Republicans like Musk so worried about deficits? Tesla's version of the humanoid robot is called Optimus, and Musk has been trying to play catch-up with other robot companies like Boston Dynamics and Figure. Boston Dynamics' Atlas was doing backflips almost a decade ago, while Optimus is still being tele-operated for Musk's smoke and mirrors shows. Back in January of 2024, Musk posted a video of Optimus folding laundry, but it was only revealed later that there was nothing autonomous about any of it. If you watched closely, you could see a hand slip into frame, showing that a human was doing the real work, which was mimicked by the robot, tech that's been around since the middle of the 20th century. The promise of robots doing all the work while humans embrace a kind of leisure society has been around for over a century. It was extremely common in the 1960s for very serious people to predict that we'd be working anywhere from just 16 to 30-hour weeks on average by the year 2000. They believed automation would make such a future inevitable. And Musk has been promising the exact same thing. He's even suggested that humans would need to have some kind of guaranteed basic income since there wouldn't be much work for humans to engage in anymore. It's all a fantasy, of course. At least it's a fantasy if you apply Musk's version of politics to this future. And it's extremely likely that Musk understands it as a fantasy. Even if humanoid robots did become commonplace and did most of the manual labor in society, that doesn't mean everyone gets a free paycheck. In fact, Musk has been fighting against exactly that idea, insisting that supposed freeloaders shouldn't get government benefits. And that's where Thiel is absolutely 100% correct. Musk doesn't understand the political implications of his own technology. It would take engaging in radically different politics to give everyone a universal basic income. Because in a world where productivity is radically increased, the wealth created isn't going to be shared with the workers. American productivity has improved radically since the 1970s, while wages have remained stagnant, relative to that growth. All that we've seen is a transfer of wealth to the richest people in the world, while everyone else struggles. Over the past decade, the top 1% have seen their wealth increase by at least $33.9 trillion, according to figures released today by Oxfam International. It's not just robots where Thiel thinks Musk doesn't understand his own tech. Thiel, who has known Musk since the 1990s when both were at PayPal, also suggested during his interview with the Times that Musk doesn't get how this would apply to Mars. Thiel had been a big proponent of seasteading, the movement to build artificial island nations and create an entirely new libertarian world on the ocean. And Musk's vision for Mars wasn't entirely different. As Thiel told the Times: There is a political dimension of getting 'Back to the Future.' You can't — this is a conversation I had with Elon back in 2024, and we had all these conversations. I had the seasteading version with Elon where I said: If Trump doesn't win, I want to just leave the country. And then Elon said: There's nowhere to go. There's nowhere to go. And then you always think of the right arguments to make later. It was about two hours after we had dinner and I was home that I thought of: Wow, Elon, you don't believe in going to Mars anymore. 2024 is the year where Elon stopped believing in Mars — not as a silly science tech project, but as a political project. Mars was supposed to be a political project; it was building an alternative. And in 2024 Elon came to believe that if you went to Mars, the socialist U.S. government, the woke A.I. would follow you to Mars. Musk has been obsessed with getting to Mars, even with some high profile fuck-ups from SpaceX in recent months. And it's really interesting to hear Thiel discuss these topics because he's absolutely right. If Musk actually believed in the things he's selling, his political outlook would be radically different. But he's stuck in this 20th-century mode while tinkering with his silly science projects, as Thiel puts it. Thiel, a fascist who doesn't believe women should be able to vote, is a very dangerous man. But he at least seems to understand the world he's trying to create. Douthat referred to Thiel during the interview as a 'venture capitalist for politics,' a funny rebranding of the term oligarch. But Musk doesn't seem to understand the world he's creating. Whether that turns out to be better or worse for humanity is less clear.
