HomeIndustry SectorsFinance and PolicyRand plummets as Eskom implements biggest cut since 2008

Rand plummets as Eskom implements biggest cut since 2008

On Friday, Eskom was forced to implement stage 2 rotational load shedding which escalated to stage 3(a) and 3(b) over the weekend- urgent measures taken to avoid a total collapse of the national grid.

This is a result of the power system being under severe constraint due to depleting water and diesel reserves at Eskom’s peaking power plants, leading to the shut-down of two open-cycle gas turbines at Gourikwa and Ankerlig.

Eskom spokesman Andrew Etzinger said that ‘we [Eskom] have a lot of generation plants out of service because of technical faults and we also have constraints on our diesel power stations in terms of fuel delivery’, the daily mail reported.

With the state utility’s rampant blackouts over the last few weeks, the rand has fallen to a record low against the dollar, reaching R11.3850- weaker than R11.390 in late January, according to Reuters.

Reuters said that ‘it was the biggest loser among a basket of emerging market currencies trading against the dollar and tracked by Reuters’.

Ian Martin, Rand Merchant Bank currency trader told Reuters that ‘there’s not much going for the rand at the moment…the rand is under pressure and I would imagine it’s going to remain so for the rest of the year’.

The blackouts are the biggest since 2008, which caused South Africa’s largest gold and platinum mines to shut down for days, costing the country millions of rand’s a day.

Short-term vision

Chief Executive Tshediso Matona said in a statement on Friday that the utility would try its best to ensure a reliable power supply over the holidays, but consumers would need to assist by reducing their electricity consumption.

‘Our objective for load shedding this weekend is to fill the pumped storage dams, fill diesel tanks and undertake essential maintenance. Our aspiration after that is to avoid load shedding if at all possible until mid-January…

Unfortunately we cannot guarantee this but we will put in every effort over the festive season to avoid interruptions’, he said.

(Pic Credits: enca)

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.