South Africa braced for the return of rolling power blackouts as Eskom, the state power monopoly that is battling to avoid collapse, imposed cuts for the first time in months.
Eskom, which generates nearly all of the electricity for Africa’s most industrial nation, said on Tuesday that it had to impose the blackouts “due to high levels of unplanned breakdowns” at its coal power plants.
“We unreservedly apologise to South Africans for the negative impact this may have and want to assure the nation that we continue to work tirelessly to ensure security of energy supply,” Eskom said.
The outages are the first since Eskom imposed even worse blackouts early this year that ravaged South Africa’s economy and exposed the depths of a $30bn debt crisis that has threatened to push the monopoly into bankruptcy.
The return of the blackouts will embarrass President Cyril Ramaphosa who has been on a drive this month to encourage foreign investment. He has promised to reform the stricken utility.
The latest cuts will take 2,000 megawatts of demand from the South African grid and may last a week, Jan Oberholzer, Eskom’s chief operations officer, told local media.
South Africa’s economy suffered its worst slump in a decade as a result of this year’s power cuts, which left factory floors, shops and smelters in darkness for hours at a time.
Years of corruption and mismanagement under Mr Ramaphosa’s predecessor, Jacob Zuma, left Eskom with surging costs, falling revenues and a fleet of breakdown-prone coal power stations. Older plants are near the end of their productive lives while work on two newer giant coal stations has fallen behind schedule, causing Eskom’s debts to balloon.
Eskom now cannot pay back the debts without regular state support — endangering South Africa’s credit rating, which is on the verge of being cut to junk.
The ruling African National Congress has unveiled billions of dollars in bailouts for Eskom this year but failed to agree on reforms to end the utility’s debt spiral.
The president has backed a plan to split Eskom into three state-owned businesses that would be easier to finance. But trade union allies of the ANC have resisted the restructuring, saying it would lead to wholesale privatisation.
Eskom has also lacked stable internal leadership for years. At the moment it lacks a full-time chief executive.
Mr Ramaphosa told the FT’S Africa summit this week that the government was working on “innovative ideas” to turn round Eskom’s debts and that the utility’s governance would be strengthened” with new appointments.
