Load shedding cost South Africa R50-billion

Load shedding cost SA R50-billion
Kea’ Modimoeng	Published:Aug 27, 2008
Eskom incompetence cost R50bn Related Content Blackouts won’t harm economy: Erwin What planet are you on, Mr Erwin? BLOG: Still no reply from planet Erwin CARTOON: The R50bn bungle Power Crisis Special Report Electricity watchdog puts shocking figure on Eskom’s incompetence ESKOM’S load-shedding bungle earlier this year cost the economy R50-billion. Blackouts won’t harm economy: Erwin What planet are you on, Mr Erwin? BLOG: Still no reply from planet Erwin CARTOON: The R50bn bungle Power Crisis Special ReportThis revelation by the National Energy Regulator (Nersa) comes barely seven months after Public Enterprises Minister Alec Erwin assured the nation that the electricity crisis would not affect economic growth. He said in January: “The government is confident that through the reduction of electricity use, the current healthy [economic] growth could be maintained.” The next day, The Times published a front page with the headline “What planet are you on, Mr Erwin?” Yesterday, Nersa chief executive Smunda Mokoena released the bad news at a conference on the mining and metallurgical industry’s response to the power crisis. The Chamber of Mines said investment in the mining industry over the next five years was likely to be reduced by between R16-billion and R25-billion because of the 10percent power reduction forced on mines. Roger Baxter, an economist for the chamber, said a survey of mining companies had found that jobs were at risk. Employment was expected to drop “substantially” if the reduction in the power supply was maintained. Mbulelo Ncetezo, Nersa’s executive manager for electricity regulation , said the R50-billion loss to the economy was based on a cost of R75/kWh for the energy required that Eskom could not supply. From November 1 to January 31, there was a 67GWh shortage because of load shedding. Nersa said it was sceptical about the feasibility of Eskom, as opposed to the government, procuring new generating capacity. “There is a perception that it cannot be a player and the referee at the same time. Some people have expressed discomfort in submitting their business plans to a potential competitor.” Nersa has also identified a potential conflict of interest between the generator of electricity, Eskom, and the system operator. Ncetezo said power stations’ main concern was the maintenance of their machines whereas the system operator’s priority was adequate power supply. Eskom spokesman Andrew Etzinger said the utility recognised the effect on the economy of the power cuts. Erwin was not available for comment yesterday.