Load-shedding shocker – It cost the SA economy up to R338 billion

A new report by the CSIR Energy Centre shows that South Africa had the worst year of load-shedding on record in 2019, costing the economy between R60 billion and R120 billion last year alone.

The total economic impact of load shedding in South Africa could be as high as as R338 billion over the past 10 years.

The CSIR report by Jarrad Wright and Joanne Calitz shows that South Africa experienced 530 hours of load-shedding in 2019, amounting to 1,352GWh.

Bad news for the country is that load-shedding is expected to continue for the next 2 to 3 years, depending on key decisions and actions.

According to the report, urgent action is needed to turn the situation around and to ensure South Africa’s energy sector recovers.

The chart below shows the amount of load-shedding which took place between 2008 and 2020, measured in GWh.

Historical fleet EAF decline seems irreversible

One of the biggest problems Eskom faces is its declining energy availability factor (EAF), which experts warn is cause for serious concern.

The energy availability factor shows the percentage of Eskom’s generation capacity which is available, taking into account planned maintenance and unplanned breakdowns.

EE Business Intelligence MD Chris Yelland said the EAF data for 2019 paints a grim picture of ageing, under-maintained, and stressed power plants.

“The EAF for the full 2019 calendar year has hit a new record low of 67%, compared to the EAF of 72% for the 2018 calendar year,” said Yelland.

He added that the EAF for Week 50 and Week 51 of 2019 hit record all-time lows of 59.7% and 58.0% respectively.

The CSIR has provided a chart which shows the updated EAF expectation which paints a grim picture of what lies ahead for Eskom and South Africa.

This is a crisis

The report said South Africa’s electricity situation is a crisis and that the interventions below are urgently needed to alleviate the problems.

  • Ensure capacity under construction is delivered as planned. This includes Medupi, Kusile, and the Renewable Energy Independent Power Producer Procurement Programme.
  • Recover the Eskom fleet EAF to realistic levels whilst ensuring value for money relative to alternatives.
  • Encourage embedded generation and energy storage like solar power with batteries for residential, commercial, agricultural, industrial and mining operations.
  • Address the remaining capacity and energy gap via an accelerated Department of Mineral Resources and Energy (DMRE) Risk Mitigation Power Purchase Programme (RMPPP) process to ensure capacity is online when required
  • Continue implementation of IRP 2019 as an immediate focus to ensure sufficient lead-time for procurement processes and technology-specific construction lead-times.

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Load-shedding shocker – It cost the SA economy up to R338 billion