Expect 200 more days of load shedding in 2024, says Reserve Bank

 ·29 Apr 2024

The South African Reserve Bank (SARB) projects 200 more days of load shedding in 2024, despite the absence of power cuts over the past few weeks.

On Sunday (28 April), after 32 consecutive days of suspending load shedding, Eskom said power cuts would remain suspended until further notice.

The power utility said this is due to sustained generation capacity and sufficient emergency reserves.

Despite the good news, many experts, including Electricity Minister Kgosientsho Ramokgopa and those at the SARB, have warned that load shedding is likely to return.

Eskom’s latest winter outlook—featuring projections for April to August—anticipates anywhere between five and 103 days of load shedding in the coming months, depending on breakdowns, demand and plant performance.

In the most ‘likely’ scenario, the country should see 50 days of load shedding in the coming months, capped at stage 2. However, if the current positive performance continues, this will be reduced.

Setbacks can happen

In his most recent media briefing on implementing South Africa’s Energy Action Plan, Ramokgopa said Eskom has managed to make great progress but warned that, because of the nature of the space it operates in, setbacks can happen, often unexpectedly.

“We are still working on the reliability of these machines, and that’s why you can’t confidently say load-shedding is behind us. That would be a false claim, and it can’t be substantiated,” he said.

Energy expert Chris Yelland agreed with this sentiment and added that intermittent load-shedding will continue until the utility’s long-term problems are resolved, such as the bypassing of the flue-gas desulphurisation plant at Kusile power station.

Additionally, the SARB Monetary Policy Review for April said load-shedding is expected to decrease gradually in the next three years but will still be a significant drag on growth.

For the Reserve Bank’s projections to match reality, load shedding would have to be in effect for all but 47 of the remaining 247 days of the year.

The graph below shows the SARB’s outlook for load-shedding over the next few years.

In 2023, South Africa’s Gross Domestic Product (GDP) grew by only 0.6%, which the SARB deemed insufficient given the increasing population and labour force.

The Reserve Bank predicts that growth will slowly improve in the near and medium term as the electricity supply gradually increases.

This improvement will be supported by private investments in renewable energy generation and increased maintenance by Eskom.

“Although the full implementation of the energy and logistics sector reforms will ease the performance challenges in these network industries, inadequate electricity supply and logistical bottlenecks are expected to remain a drag on the economy,” the SARB said.

The SARB projects real GDP and potential growth to improve to 1.2% this year and rise to 1.6% by 2026.

However, even if achieved, these growth rates remain well below South Africa’s long-term average growth rate of about 2.0% and far below the 4.1% average growth for emerging markets in the current year projected by the International Monetary Fund (IMF).

“In the near term, uncertainty around the reliability of electricity supply persists as the grid remains fragile amid still-elevated unplanned outages, as evidenced by the occasional bouts of Stage 6 load-shedding earlier this year.”

Considering these sentiments from several experts, the SARB predicts South Africa should expect to experience 200 more days of load shedding in 2024.

This forecast for 2024 could see 270 days of load shedding, which includes the 70 days already experienced year-to-date (YTD)—meaning there would only be 19 fewer days of load shedding experienced last year, which was a record year for power cuts.

Read: Stage 6 load shedding not on the cards for winter: Eskom

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