HomeIndustry SectorsFinance and PolicyA snapshot of the financial slump as a result of Eskom

A snapshot of the financial slump as a result of Eskom

In January, The International Monetary Fund predicted that the South African economy will see a low growth rate of 2.1% in 2015 should load-shedding persist.

The decision to hike electricity tariffs by 13% in April 2015 places another hurdle in front of the economic growth of the country.

Cost calculations

Mybroadband.com reported that when stage 1 load shedding is implemented, ZAR20 billion ($2 billion) is lost over a 20 day period consisting of a ten hour blackout a day.

When load shedding moves to stage 2 the monthly cost jumps to ZAR40 billion ($4 billion) and at stage 3 the cost peaks at ZAR80 billion ($8 billion).

Energy expert Chris Yelland said that “these costs to the productive economy for load shedding in [South Africa] are based on a cost of unserved energy of ZAR100 [$9] per kWh”.

“The cost of unserved energy to the productive economy in SA caused by this Eskom “human error” at Koeberg is estimated to be ZAR7.5 billion [$604 million]”, Yelland continued.

The additional cost of diesel needed when technical faults occur, amount to an estimated ZAR250 million ($21 million), according to Yelland.

With both Medupi and Khusile falling four years behind schedule immediate solutions are needed to prevent the country from a complete collapse.

(Pic Credits: haikudeck)

Nicolette Pombo-van Zyl
As the Editor of ESI Africa, my passion is on sustainability and placing African countries on the international stage. I take a keen interest in the trends shaping the power & water utility market along with the projects and local innovations making headline news. Watch my short weekly video on our YouTube channel ESIAfricaTV and speak with me on what has your attention.