South Africa

ENERGY CRISIS

Impact of Russia’s war on Ukraine about to be felt hard and fast for South Africans

(Photo: Dwayne Senior / Bloomberg via Getty Images)

The first major load shedding for 2022 shows how Russia’s war against Ukraine can affect South Africa’s energy needs.

South Africans are under the cosh. Increases in the price of fuel have taken petrol inland to over R21 a litre – a 60-litre tank now costs over R1,200 to fill. With the war on Ukraine sending the prices of oil, gas and coal spiking, the impacts here are already being felt.

Economists predict another huge petrol price increase in April and South Africa’s reliance on open cycle gas turbines for emergency power is a major risk. With an energy grid still largely reliant on coal, Eskom is seeing flames and its cost base will go up as the coal price surges and demands for exports rise.

The electricity utility had 17 units at risk, it announced on Tuesday, and load shedding was extended to Saturday morning at 5am. Eskom CFO Calib Cassim said at a briefing that the utility could soon reach a point where it can no longer afford to pay for the emergency diesel which keeps the turbines going, News24 reported.

Energy regulator Nersa has approved a 9.61% increase to Eskom from 1 April, but it had applied for a 20.5% increase. Eskom’s debt stands at R390-billion and is only due for restructuring by 2024. 

Municipalities add an additional surcharge (although they pay a slightly lower tariff for bulk purchases), which means that, come July, households already buckling will pay an energy tariff that is double the current inflation rate. 

The SA Reserve Bank has indicated that it will increase interest rates to offset inflationary pressures, but this could push many households to the brink.

Small businesses employ the highest proportion of South Africans and load shedding takes an enormous toll, as many readers told Daily Maverick. Most small businesses use generators to keep going during power cuts. But the cost of keeping generators running is set to rise as the consequences of Russia’s war are felt across the world.   

Eskom’s scheduled power cuts were more numerous in 2021 than ever before, and it warned that the high number of unscheduled power outages would have an impact on essential maintenance work. DM

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All Comments 11

  • No actually since coal is a national resource they price it for a mainly poor African country. Why must we pay international prices for a local resource when there’s a hundred years or so of supply?

  • I’ve also missed something. We use low grade coal and export high grade. We should be bringing billions into the Treasury. We can develop our own green grid if Gwede stays out of the way. Infrastructure problems with Transnet and the Ports have to be overcome very quickly, as per a pundit-apologies, name forgotten!-on ENCA.

    • Agreed about Gwede staying out of the way.
      I see he, and the ANC have stopped a Parliamentary investigation into Karpowerships, so he is intent on keeping coal as the main source.
      I have just read on DM that a state in the US uses 60% wind power. SA could easily do the same with Solar.

      • I agree, it makes sense to rather spend the public’s rands on solar and wind generators.
        In South Africa we are blessed with an abundance sunshine and wind.
        Coal will be with us for a long time, but our focus should be with developing alternative sources of energy.

  • The coal exporters cant get the coal to the Bay or matola because the trains dont go. Therefore there is enough coal to burn in the power stations. Except the power stations dont go because there are no engineers to maintain them.

  • Imagine if we could sell our excess solar power to the grid? Gwede would have a heart attack and I can’t see that as being a bad thing.

  • Stage 4 now. This is treason, even if it is not sabotage or tariff terrorism but just incompetence, this level of incompetence should be illegal!

    Without renewables we would be at stage 6 : 12 hours a day no power.

    Half their damned coal capacity is broken. Ukraine probably manages more than this in the middle of a war.

  • They had it coming. Had we started getting serious about renewables five, or more, years ago we would have had a safety net. It’s called planning !

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