Amid all the focus on Europe’s energy troubles in the past year, a byproduct of the continent’s legacy reliance on Russian commodity exports, it has largely slipped the world’s attention that a far more brutal – and mostly ignored – energy crisis is taking place right now in South Africa, which recently declared a state of disaster due to its energy crisis.
This crisis, discussed in more detailed below, came to a head overnight when South African utility Eskom – which is not only the largest producer of electricity in South Africa but in all of Africa, and is among the top utilities in the world in terms of generation capacity and sales – and which has been forced to implement power cuts every day this year as its fleet of old and defective coal-powered stations frequently breaks down, reached an unprecedented level of power cuts, indicated late on Tuesday by the company spokesman.
As Bloomberg notes, the record rationing is a severe blow to Africa’s industrialised economy, which is struggling to rebound from the coronavirus pandemic and rebuild battered business confidence. Eskom has subjected the country to power outages every day this year. The South African Reserve Bank estimates the outages cost the nation as much as 899 million rands ($49 million) per day.
Eskom, which supplies most of South Africa’s power from coal-fired plants, has been implementing rolling blackouts since 2008 because it can’t meet demand. Less than half of the utility’s generation capacity is available, two newly built coal-fired plants have also proven unreliable and other defective generating units have had to be taken offline for repairs. The government has declared a state of disaster due to its energy crisis.
Economists polled by Bloomberg predict the economy shrank in the final quarter of 2022 and that it’s on course to contract in the three months through March largely because of the sustained power cuts. Plans to add capacity from private producers have been dogged by delays and legal disputes. Eskom says the country needs an additional 4,000 to 6,000 megawatts of generating capacity to ensure a secure energy supply. The so-called energy availability factor of Eskom’s fleet has been declining every year since 2017, according to the Council for Scientific and Industrial Research.