South Africa is facing an ongoing energy crisis, with some areas of the country enduring power outages for up to 8 hours a day.
Controlled power cuts, known locally as ‘loadshedding,’ have been occurring in South Africa since 2007, largely due to the failure of the state-owned electricity provider, Eskom, to keep up with the country’s rapid economic growth.
Eskom is responsible for the generation, transmission and distribution of around 95% of South Africa’s electricity, however, for many years it has failed to supply enough power to meet the country’s demands. Whilst ongoing, the situation has gotten considerably worse in recent months. 2022 had the most power cuts than any year previously, with power outages being imposed on 205 days of the year. So far, the country has experienced power cuts every day in 2023 and the situation is showing no signs of improvement.
In January, South African President Cyril Ramaphosa was forced to cancel his trip to the World Economic Forum in Switzerland to hold emergency meetings to address the escalating energy crisis in the country. Furthermore, a national state of disaster was declared on 9 February which enables the government to buy emergency power from neighbouring countries, as well as making exempt critical infrastructure such as water treatment plants and hospitals from power cuts.
Why can Eskom not meet the energy demands?
Many of the power stations used by Eskom today were built over 50 years ago, meaning that they regularly experience breakdowns due to ageing equipment. This is exacerbated by the fact that these stations are running at non-stop capacity in an attempt to keep up with energy demands, putting them under immense strain and giving little opportunity for equipment to be replaced and maintenance repairs to be carried out.
In 2007 and 2008, construction began on two new power stations, Medupi and Kusile, which were intended to increase energy production in South Africa by around 25%. However, due to technical design defects, construction delays and significant cost overruns, both are yet to be fully operational.
Eskom is nearly R400 billion in debt ($26 billion) and is currently not generating enough income to cover even its operating costs and interest payments.
Crime such as cable theft and sabotage at power plants has added to the problem. Power outages make it easier for thieves to steal equipment from power stations and transmission lines, hindering Eskom’s ability to mitigate the crisis.
Years of corruption and mismanagement by government officials and Eskom employees has made matters worse. Many workers in high-up positions have been appointed through nepotism and are under-qualified for the job that they are doing. Mosebenzi Zwane, for example, was appointed as minister of mineral resources in 2015, despite having no experience in the mining industry.
Corruption under former president Jacob Zuma has significantly worsened the situation. An enquiry by the anti-corruption commission found that whilst in power, Zuma misappropriated public funds and facilitated state capture through political meddling in Eskom’s operations.
Repeated leadership changes at the company under the former president were also found to be part of a plan to steal taxpayer’s money.
A further inquiry into corruption and fraud in the public sector found that Eskom’s former board members should face criminal charges due to mismanagement and a “culture of corrupt practices.”
Today, the country has a new leader, however corruption within Eskom is still prevalent. Eskom’s own annual report from 2022 mentions that ‘fraud, corruption, sabotage and other criminal conduct have taken root within Eskom.’
Eskom’s financial statements also reveal that 104 cases of corruption and fraud within the company were registered with the South African Police Service last year.
In November 2022, a contracted worker was found guilty of purposefully damaging equipment at Camden power station in Mpumalanga so that his employer would be given additional maintenance and repair jobs.
Impact on businesses and livelihoods
Loadshedding is currently South Africa’s biggest constraint to economic growth, with power outages being estimated to cost the country $1 million an hour.
Loadshedding has served to exacerbate inequality in what is already the world’s most unequal society. Whilst the wealthy minority can afford to power their homes during blackouts using expensive generators and invertors, those in the townships are forced to live without power. This means that they are often unable to prepare proper food at meal times and children have to do their homework in the dark. Working from home and searching online for jobs is also not possible without a generator, being highly problematic given the country’s high unemployment rates.
Large areas of the country are experiencing limited or no water supplies, sometimes lasting for multiple days, as pumping infrastructure cannot operate during loadshedding.
Many businesses can’t operate when the power is off, meaning they are forced to shut their doors during these times. Some have resorted to using battery powered devices such as card machines for backup when the power goes out. However, with recent blackouts lasting 6-8 hours a day, there is often not enough time for their devices to fully re-charge.
Small businesses are worst hit by the revenue losses brought on by loadshedding. Independent shops and restaurants have seen a loss in customers in the evenings as people are scared to go out during a blackout when the street lights are off.
The agricultural industry has seen losses in production due to persistent loadshedding disrupting irrigation, processing and storage systems. This is presenting a risk to South Africa’s supply chains and food security, driving up food prices and adding to the growing economic crisis.
Traffic lights also stop working during power outages, resulting in increased congestion on the roads and making many people late for work.
The inconsistency of loadshedding, with its schedule and duration changing daily, makes it very difficult for businesses to plan around the disruption.
Political violence, protests and crime
Violent protests have taken place in some areas in response to the worsening crisis. Earlier this year, in Boksburg, a suburb of Johannesburg, residents burnt tyres and blockaded roads with rocks in protest. Similarly, in Phoenix, Durban, residents took to the streets in protest, burning tyres and damaging infrastructure.
Calls for a national shutdown have been gaining traction online, with the hashtag #NationalShutdown trending online throughout much of January. The opposition party, the Democratic Alliance, led marches in Johannesburg and Cape Town on the 25th of January to protest against loadshedding and the ongoing energy crisis.
Crime has been seen to increase during blackouts, with it being found that loadshedding increases the risk of home break-ins by up to 8%. When the power is out, electric fences, gates and alarm systems stop working, as well as street lights being off, making it easier for criminals to operate.
The insurer Auto & General said it saw a 40% increase in the number of burglaries in the first two weeks of 2023 compared to the same time period in 2022.
Amidst rising living costs and an ever-worsening energy situation, it is likely that violent protests and riots will continue to take place in coming months.
In response to the energy crisis, South Africans have increasingly been looking to move towards more renewable energy sources such as solar and wind. However, this comes at a time when we are seeing a ‘global rush’ for solar and wind energy components. This is being driven by mounting pressure for countries to increase their renewable energy usage due to climate change, as well as recent geopolitical events such as;
- A cost of living crisis in the EU and UK, that is being exaggerated by rising energy prices
- The ongoing war in Ukraine meaning that the EU is urgently trying to reduce its dependency on Russian gas.
- China’s plan to add at least 100,000MW of renewable energy to its grid in the next 5 years.
- Extreme weather conditions in parts of the US; California experienced record-breaking temperatures in September last year, putting unprecedented pressure on the energy grid due to a surge in people using air conditioners.
There is worry that this rush will ‘complicate global supply chains and capacity,’ as well as drive up global prices for renewable components. South Africa will be unable to compete with richer economies such as the EU, China and the US for resources, painting a bleak picture for South Africans who are presented with little hope of the energy crisis being resolved in the near future.