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Telecoms bodies call on diesel rebate from Godongwana

Sibahle Malinga
By Sibahle Malinga, ITWeb senior news journalist.
Johannesburg, 21 Feb 2024
Economic infrastructure sabotage is destroying investor confidence, says the telecoms sector.
Economic infrastructure sabotage is destroying investor confidence, says the telecoms sector.

As the country waits for today’s budget speech, local telecommunications bodies the Communication Risk Information Centre (COMRiC) and the Association of Comms and Technology (ACT) are urging finance minister Enoch Godongwana to prioritise two critical areas of concern that significantly impact the sector and the broader community – the impact of load-shedding and telecommunication infrastructure damage.

According to a statement, the telecommunications sector believes it is important to keep the cost of services as low as possible and government has a critical role to play in ensuring this is achieved.

Both bodies are calling on the minister to consider diesel rebates for the telecommunications sector.

They say reliance on diesel generators to provide back-up power for cell towers, especially in remote and underserved areas, is a significant operational expense.

Since Eskom started load-shedding, SA’s mobile operators have seen a spike in incidents of theft and vandalism of their infrastructure, leaving communities without connectivity, they complain.

Last year, Vodacom announced it had spent over R4 billion on back-up power, including batteries and generators, over just the last three years amid the ongoing grid instability.

In MTN’s financial results for the year ended 31 December, the telco lamented the challenges brought by the power crisis, saying load-shedding impacted earnings before interest, tax, depreciation and amortisation by R695 million.

According to COMRiC and ACT, although the industry has proactively spent billions of rands in back-up power solutions for network stability and continuity, customers were increasingly becoming frustrated when they experience a drop in network performance during higher levels of load-shedding.

Furthermore, telecommunications companies are spending big on diesel to stave off load-shedding, with some R1.2 billion spent in 2023 alone. Economic infrastructure sabotage is destroying investor confidence, impacting on connectivity, and destroying critical infrastructure needed for economic growth, they say.

“In the face of power outages, which are particularly common in regions with unstable power grids, diesel generators ensure network uptime, maintaining crucial communication channels for both consumers and emergency services,” notes the statement.

“A rebate on diesel would not only alleviate the financial burden on providers, ensuring continued service reliability and consumer satisfaction, but also enable cost savings to be redirected towards network expansion, technological upgrades, and more sustainable energy solutions.”

A rebate would significantly contribute to improving connectivity in rural and under-developed areas, fostering inclusivity and economic growth. During 2023, it is estimated that telecommunication companies spent more than R1.1billion in diesel to power up critical infrastructure, notes the statement.

COMRiC is a collaborative effort among SA’s major telecommunications operators, focused on protecting networks from criminals, while ACT collaborates with stakeholders across the ICT ecosystem to advocate for a thriving communications and telecommunications sector.

COMRiC and ACT say they would also like to see an increase in the law enforcement budget dedicated to fighting crimes against telecommunications infrastructure.

The rampant theft of high-capacity batteries, diesel fuel and vandalism of base stations, driven by criminal syndicates, poses a severe threat to networks' integrity and resilience.

“These criminal activities not only incur substantial financial losses for providers, but also jeopardise the security and reliability of communications for millions of South Africans. By enhancing police visibility and capacity, we can more effectively combat these crimes, safeguarding our infrastructure and ensuring uninterrupted service to the public,” they warn.

“We look forward to the finance minister's support on these matters, as we continue to work towards a more connected and secure South Africa.”

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