{"id":522959,"date":"2024-01-28T08:59:43","date_gmt":"2024-01-28T06:59:43","guid":{"rendered":"https:\/\/mybroadband.co.za\/news\/?p=522959"},"modified":"2024-01-28T09:01:10","modified_gmt":"2024-01-28T07:01:10","slug":"eskoms-collapse","status":"publish","type":"post","link":"https:\/\/mybroadband.co.za\/news\/investing\/522959-eskoms-collapse.html","title":{"rendered":"Eskom’s collapse"},"content":{"rendered":"

Over the last 15 years, the amount of electricity generated in South Africa has declined by nearly 4,000 GWh due to the rapid deterioration of Eskom\u2019s performance.<\/p>\n

Eskom has a proud history. For 85 years, the power utility provided South Africa with reliable, affordable electricity.<\/p>\n

Eskom even won the Power Company of the Year at the Global Energy Awards in 2001, showing just how great a power utility it used to be.<\/p>\n

Fast forward two decades and Eskom has become a company in freefall that struggles to keep the lights on.<\/p>\n

Over the last 15 years, Eskom\u2019s financial and operational performance plummeted, and it is now selling less electricity than it did in 2008.<\/p>\n

Eskom is even starting to import power from neighbouring countries in southern Africa, like Botswana and Zambia, which have more electricity capacity than they require.<\/p>\n

This rapid deterioration can be shown in data released by Statistics South Africa (Stats SA), which tracks the amount of electricity available for distribution in the country.<\/p>\n

In the latest report \u2013 for November 2023 \u2013 the organisation published a graph showing the steep decline in electricity generated in South Africa. This is shown below.<\/p>\n

\"\"<\/a><\/p>\n

In a cruel one-two combination for South Africans, the price of electricity over the same period has\u00a0jumped 446%<\/a><\/strong>.<\/p>\n

The current electricity pricing regime ties prices to Eskom\u2019s costs, resulting in years of mismanagement and crisis spending being passed on to consumers.<\/p>\n

South Africa\u2019s energy system faces a dual crisis of rising costs and declining performance.<\/p>\n

Household electrical costs have risen by 60% since 2017, and the recently announced price increases for the 2023\/24 financial year of 18.7% will maintain the pressure on consumers.<\/p>\n

Despite the large price increases, it has been inadequate to cover Eskom\u2019s growing financing needs.<\/p>\n

With declining electricity demand, a costly and debt-fuelled build programme, and expensive short-term diesel usage, Eskom\u2019s needs appear increasingly unaffordable for South Africans facing the steepest inflation in recent history.<\/p>\n

Most price increases in the electricity tariff occurred after 2007, coinciding with the first wave of load-shedding.<\/p>\n

Between 2007 and 2017, the average Eskom tariff increased by 333%. By 2022, it had increased 450%, consistently exceeding headline inflation by a substantial margin.<\/p>\n

This drives inflation in South Africa, and as electricity is a universal input in producing goods and services, it raises the cost base of the entire economy.<\/p>\n

\"\"<\/a>

Source: Power Optimal<\/a><\/strong><\/p><\/div>\n

\n

This article was first published by Daily Investor<\/a><\/strong> and is reproduced with permission.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Eskom’s performance plummeted in the past 15 years, generating less power, relying on imports, and imposing steep price hikes on consumers.<\/p>\n","protected":false},"author":341119,"featured_media":486877,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_sma_x_autopost_status":"idle","_sma_x_autopost_error":"","_sma_x_post_id":"","_sma_facebook_post_id":"","_sma_instagram_post_id":"","_sma_threads_post_id":"","_sma_x_attempts":0,"footnotes":""},"categories":[80335],"tags":[181,35,8487],"class_list":["post-522959","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-eskom","tag-headline","tag-load-shedding"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/522959"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/341119"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=522959"}],"version-history":[{"count":0,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/522959\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/486877"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=522959"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=522959"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=522959"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}