Load shedding could last for ‘at least a year’: report

While no load shedding has been scheduled for Sunday – putting an end to 10 consecutive days of rolling blackouts for South Africa – a senior Eskom official says that power cuts could last for at least another year as the power utility scrambles to secure a new maintenance contract for its ageing plants.

The Sunday Times reports that the contract is needed for the early detection of leaks on boilers of its power plants, as these fissures can expand and lead to units crashing.

The previous contract lapsed in 2017 and Eskom has been unable to secure one since then – contributing to this week’s stage 4 load shedding.

Head of generation at Eskom, Brian Etzinger, said that the contract provided the licence for the actual leak-detection software and the contracting of skills to operate the system.

However, Etzinger said that an earlier attempt made to source the skills needed to operate the system failed and it has now taken an unnecessarily long time to find these experts given Treasury’s strict rules on commercial processes.

Another senior official reportedly warned that we should expect load shedding for at least another year.

No load shedding on Sunday

Eskom managed to reduce stage 4 load shedding to stage 2 this weekend as some capacity gradually returned – primarily large parts of the lost Mozambique imports.

On Saturday night (23 March) the power utility announced that load shedding would be suspended earlier than usual (around 21h00 instead of 23h00) and that load shedding was not scheduled for Sunday.

However, the group warned that even though there were no planned outages, the grid remains incredibly vulnerable, and that any further loss of capacity would see the blackouts return.

Downgrade

South Africa’s latest rounds of load shedding could not come at a worse time, economists say, as ratings agency Moody’s prepares to review South Africa’s credit rating in the coming week.

Moody’s is currently the only major ratings agency that has South Africa at ‘investment grade’ – one notch above junk –  with a stable outlook.

S&P and Fitch both downgraded SA to junk status in 2018, in response to the surprise cabinet reshuffle and an unfavourable mid-term budget in October 2017.

According to PwC economist, Lullu Krugel, the latest bout of load shedding has come at the worst time, given its proximity to the Moody’s review, saying that the blackouts could push the agency to change the country’s outlook to negative – or to outright downgrade the country to full junk status.

Chief economist at Efficient Group, Dawie Roodt also believes that the chances are high that South Africa will be downgraded.

Roodt said that by his calculations, the South African economy would be 10% bigger than it is, if Eskom could work correctly.

“(Stage 4 load shedding) will have a knock-on effect on the current debt/GDP ratio which would mean that a Moody’s downgrade is likely,”  he said.


Read: Eskom’s problems are financial, structural and operational: chairman

Must Read

Partner Content

Show comments

Trending Now

Follow Us

Load shedding could last for ‘at least a year’: report