Again South Africa in the dark

By Anusha Rathi

Eskom, the state-owned monopoly that is responsible for overseeing all stages of electricity provision in the country from generation to distribution, was established in 1923 during the apartheid era and followed a grid system that was designed to serve the country’s white minority. The grid largely bypassed Black areas and, as a result, struggled to meet the country’s rising energy demands over time.

But that’s not the biggest problem. There simply isn’t enough juice. A 1998 government white paper warned about the country’s poor energy planning and predicted that if South Africa did not start building new power plants, it would witness drastic shortages by 2007. The report could not have been more accurate. Often when demand for electricity exceeds supply, energy providers use load-shedding (turning off the lights) to ease the pressure and prevent the collapse of the entire power grid. Eskom started implementing load-shedding in late 2007.

“I think it’s been in our lives for as long as I can remember,” said Lauren Urmson, a student at AFDA who was born and raised in Johannesburg. “But I would say it’s definitely been the worst this year.”

Urmson, who also runs a small jewelry business online, expressed frustration over experiencing financial loss due to unreliable internet connections and expensive data plans. Recently, she was also set to perform in a play at the National Arts Festival in Grahamstown, South Africa. But even there, 2 out of 4 of her shows were canceled because of a change in load-shedding schedules. Netflix and chill is not an option either—you can’t watch TV or surf online.

“It’s just your entire life is put on hold,” Urmson said. “And it’s really frustrating for a lot of people as well because it feels like no one’s doing anything about it.”

Reforming Eskom and addressing the country’s damaging energy crisis has been a priority for South African President Cyril Ramaphosa. But it has become part of a growing list of promises that the African National Congress party has failed to deliver on.

“Twenty-eight years after the advent of the ‘Rainbow Nation,’ many people living in shacks are still waiting for promised government housing; the state power utility, Eskom, has collapsed to the point that there are frequent power cuts; and even millions of dollars meant to help fight COVID-19 were found to have been misappropriated,” wrote Kate Bartlett in a recent FP profile of Nhlanhla “Lux” Mohlauli, a South African politician.

Instead of building a new generation of plants when it should have, in 2007 and 2008, Eskom placed orders for two large-scale coal-fired power stations in Medupi and Kusile, respectively. They would have increased the power grid’s generation capacity by roughly 25 percent, said Chris Yelland, an energy analyst based in Johannesburg. But it was too little too late. The Medupi and Kusile power plants, hit by design defects and delayed construction, became entangled in time and cost overruns. By that time, older power plants were starting to reach the end of their shelf life and were decommissioned.

“The old plants kept getting older, and the new plants were performing like the old ones,” he said.

Apart from operational and structural issues, Eskom’s financial health remains poor too. The company is currently holding $25.2 billion in debt and is trying to contain costs to stay afloat.

According to economists, the power cuts are costing South Africa more than $40 million per day and adversely affecting investor confidence. Recently, trade unions, including the National Union of Metalworkers of South Africa, went on strike, protesting against Eskom and demanding higher wages. The company, in turn, labeled the strikes as illegal and blamed the workers for the extension of extreme load-shedding.

“People don’t necessarily require cheap electricity, but they do require a predictable future electricity cost,” Yelland said.

The irony is that as South Africa’s entirely state-owned utility struggles to even keep the boilers lit, European governments are turning to nationalization as an answer to their own energy crises. On Thursday, the French government said it would acquire the remaining free-floating stake in EDF, the country’s main power producer. Analysts expect Germany will tread a similar path with Uniper, the newest incarnation of what was once a big European utility.

South Africa’s power problems, dire as they are, aren’t purely domestic. Some 86 percent of the entire continent’s coal-fired generation capacity can be found in South Africa. It exports electricity to Botswana and Namibia and is part of the Southern African Power Pool, which provides electricity to countries in southern Africa.

South Africa, the biggest economy in the region, may no longer be the provider of last resort.

“Some of our regional neighbors have started to realize their vulnerability,” Yelland added. “They need to make sure that they have a certain amount of their own generation capacity and not rely too much on South Africa.”