Blackouts and South Africa’s Weak Economy
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Evidence has recently arisen that South Africa’s emerging electricity bill could threaten just about everything within the region, from sovereign debt to swimming pools. On almost a daily basis, consumers within South Africa are required to:
* Turn off their pool pumps
* Switch off their water heaters
* Shut down just about anything that could save power through peak periods
Evidence has recently arisen that South Africa’s emerging electricity bill could threaten just about everything within the region, from sovereign debt to swimming pools. On almost a daily basis, consumers within South Africa are required to:
* Turn off their pool pumps
* Switch off their water heaters
* Shut down just about anything that could save power through peak periods
Customers on an industrial scale have also been asked to cut down their energy uses significantly, even if this means reducing levels of production. When even these measures are not enough, Eskom Holdings have been known to organize managed blackouts throughout the area.
Obviously, the serious lack of power within South Africa is raising some significant concerns within the region. Many economists and financial experts are suggesting that the area could see a serious downfall if something is not done soon. Once a powerhouse driving the Apartheid economy and providing energy to various neighboring nations, Eskom is struggling to keep its plants running. Many people have suggested that this isn’t much of a surprise, as the plants are actually decades old. Although there have been some new ones scheduled to open, they are still being built years behind schedule.
Sounds like South African and the World Cup alright. Graft and corruption is ruining that country and terrible leadership too!
Table of Contents
The Issues the Blackouts are Causing
The blackouts that have been taking place on an ongoing basis throughout South Africa are developing serious issues that many countries cannot quite overcome. The state-owned utility, Eskom holdings, is struggling to cope with electricity usage in peak time, forcing reduced usage. In the commercial center, this reduction could lead to serious financial implications.
The main problem is that it is state owned. Bureaucrats ruin almost everything they touch. Nelson Mandela did not do much to fix this apparently.
Nothing to Smile About
As a utility, Eskom provides over 95% of the electricity within South Africa. Its elderly group of power stations provides 42 gigawatts of nominal capacity in total. Although this number would be enough if the company could keep the power plants running all day, the daily capacity that has been available in 2014 averaged 33.2 gigawatts. As a result, Eskom has been running managed blackouts throughout the grid to enhance stability.
In response to the outrage that blackouts have promoted, Eskom announced that their behavior is necessary to keep the grid secure. They state that if South Africa was to suffer from a full blackout, it would take at least two weeks for the system to be restarted. Obviously, this time offline would have severe consequences on every economic sector of the country.
Terrible Numbers
Although Eskom maintains a long-term plan to improve its generating capacity by over forty percent in the coming years, it currently faces a funding shortfall equal to around $20 billion through to 2018. The company has been facing shortages for some time now, and experts suggest that it could be at least another five years before Eskom can reliably keep the lights on for consumers in South Africa.
