December 11, 2019 / 10:22 AM / a month ago

South Africa's Eskom aims to stabilise grid by end of March after blackouts: president

JOHANNESBURG (Reuters) - State utility Eskom will work to stabilise the power grid by the end of March following South Africa’s most severe blackouts in a decade, President Cyril Ramaphosa said on Wednesday.

A week of heavy rains across parts of South Africa caused flooding, aggravating problems at the cash-strapped power firm, which has struggled to keep the lights on since 2008.

Ramaphosa, who cut short a trip to Egypt to deal with the crisis, met Eskom’s management and board on Wednesday.

“Going right through March, they will be seeking to do everything they can to restore the stability of the network,” he told a briefing for journalists.

He said suspected sabotage at power stations contributed 2,000 megawatts (MW) of lost capacity during the past week’s outages and needed to be investigated.

“There are certain people within the system who take it upon themselves to go and switch off certain instruments that finally lead to us losing so many megawatts,” he said without elaborating.

The public enterprises and energy ministers would present proposals to cabinet on Friday aimed at closing South Africa’s energy gap, Ramaphosa said.

They include fast-tracking applications of businesses seeking to generate their own electricity, he said, adding: “What they don’t use they will be able to put or sell into the grid.”

Eskom said it planned to reduce national grid supplies by 2,000 MW on Wednesday, down from 6,000 MW on Monday. But the company said the risk of continued rolling blackouts remained high for the rest of the week.

Struggling state-owned companies have been a major headache for Ramaphosa who came to power nearly two years ago vowing to reverse years of mismanagement and economic stagnation. He has promised “drastic” steps if necessary to ensure their survival.

A shopper uses a torch during an electricity load-shedding blackout in Hillcrest, South Africa, December 10, 2019. REUTERS/Rogan Ward

South African Airways was placed in bankruptcy protection last week and an independent administrator was appointed to run the state’s passenger rail company on Monday.

Eskom, which generates more than 90% of the country’s power, is widely regarded as the most serious risk to an economy on the brink of recession. Moody’s has said Eskom’s troubles endanger South Africa’s only surviving investment-grade credit rating.

“PERFECT STORM”

Companies across South Africa’s mining sector, such as including AngloGold Ashanti, Sibanye-Stillwater and Harmony Gold, curtailed work due to power cuts this week. Miners said they had resumed operations by Wednesday but still faced limits on electricity consumption.

Eskom Chief Operations Officer Jan Oberholzer told Reuters power cuts were caused by a “perfect storm” of extreme rainfall and breakdowns at coal-fired power plants. One coal mine and three power stations had flooded, he said.

Breakdowns were occurring across Eskom’s coal-fired plants because previous managers had not conducted critical mid-life maintenance, he said.

Slideshow (2 Images)

Ramaphosa said management had informed him the utility needed to add 5,000 MW to existing capacity of 44,000 MW to give it a buffer to take faulty coal units offline for overhauling.

In the short run, a combination of drier weather and work places shutting down for Christmas would cool demand for power, relieving pressure on the grid, said Azar Jammine, director of South Africa-based consultancy Econometrix.

But he added: “It has created a lot of uncertainty over whether we can rely on energy security in South Africa, and that in itself is going to damage economic growth.”

Additional reporting by Olivia Kumwenda-Mtambo; Writing by Joe Bavier; Editing Alexandra Zavis, Emelia Sithole-Matarise and Edmund Blair

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