South Africa faces a winter of social unrest as sustained power outages limit economic growth and job creation, amid a cost-of-living crisis and increasing political tensions ahead of elections scheduled for next year, according to the Centre For Risk Analysis.
(Bloomberg) — South Africa faces a winter of social unrest as sustained power outages limit economic growth and job creation, amid a cost-of-living crisis and increasing political tensions ahead of elections scheduled for next year, according to the Centre For Risk Analysis.
Africa’s most-industrialized economy is likely to be plagued by 43 weeks of severe blackouts, in which state-owned company Eskom Holdings SOC Ltd. will impose daily outages of as much as 5,000 megawatts as it seeks to protect the national power grid from collapse, Chris Hattingh, the think tank’s head of policy analysis, said in a note. The projection is based on the power utility’s latest energy outlook, which suggests it won’t be able to meet demand during any week through March next year, he said.
Eskom’s Biggest Union Demands 15% Pay Hike (April 13, 4:41 p.m.)
The biggest labor union at Eskom demanded a 15% wage increase, as the cash-strapped utility struggles to generate enough power to meet the country’s needs, resulting in daily blackouts.
The National Union of Mineworkers wants the same raise for all workers, along with other increases in allowances for housing and other benefits, it said in a copy of a letter to Eskom seen by Bloomberg.
Read more: Eskom’s Biggest Union Demands 15% Pay Hike as Outages Worsen (2)
Eskom Expects Transmission Firm to Be Running in Third Quarter (April 13, 1:03 p.m.)
Eskom expects to complete the spin off of its transmission company in the third quarter, according to Chairman Mpho Makwana.
Fast-tracking the process to add a separate board of directors and other measures needed to hive off the unit will create a competitive electricity trading platform that’s part of a turnaround plan to “restore healthy energy availability” and end record power outages by March 2025, Makwana said.
Eskom to Maintain Stage 6 Loadshedding Until Further Notice (April 13, 10:19 a.m.)
Eskom will reduce supply by 6,000 megawatts until further notice after a generation unit at one of its newest coal-fired power stations broke down.
The move to continuously implement so-called stage 6 loadshedding, which means as much as 12 hours of blackouts a day, was announced by the utility late Wednesday evening and followed the breakdown of a unit at the Medupi Power Station. It is one of two giant coal-fired plants, including Kusile, that have been under construction for more than a decade. The total cost of the two sites has ballooned to more than 460 billion rand ($25 billion) from an original estimate of 163 billion rand.
Restoring Power Pylons in Capital May Take Five Days (April 12, 8 a.m.)
It may take as long as five days to repair and install new power pylons that supply parts of South Africa’s capital, Beeld reported, citing Eskom’s acting spokeswoman, Daphne Mokwena.
Seven high-tension electricity towers in the northeast of Tshwane municipality, which includes the capital, Pretoria, collapsed at the weekend, cutting power supplies to the area. That included Silverton, where Ford Motor Co. has a 720-vehicle-a-day assembly plant. The factory has already lost a full day of production, Fin24 reported, citing Neale Hill, president of Ford Africa.
Theft and vandalism often hamper power supply in South Africa as criminals target electricity infrastructure.
Above-Inflation Demands for Wage Hikes (April 11, 9:59 a.m.)
The Solidarity labor union is demanding inflation-beating pay increases for its members who work at Eskom.
Solidarity wants a raise of the average inflation rate plus 3 percentage points for all workers, it said in an emailed copy of demands seen by Bloomberg. The union’s mandate is to negotiate a multi-year agreement. Average consumer-price growth in South Africa was 6.9% last year.
Eskom agreed to a 7% wage increase for workers in 2022 after illegal protests, in which roads to power plants were blocked, cars were set on fire and gasoline bombs were thrown at company managers’ homes.
–With assistance from Simbarashe Gumbo and Paul Burkhardt.
(An earlier version of this story corrected the figure for the cost of building the Medupi and Kusile power plants)
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.