The latest fallout from South Africa’s “State Capture” scandal is power load-shedding for Xmas

Workers are seen near cooling towers of the Hendrina power station, located south of Middelburg, South Africa
Workers are seen near cooling towers of the Hendrina power station, located south of Middelburg, South Africa
Image: Reuters/Siphiwe Sibeko
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The wide-ranging state corruption scandal that has dogged South Africa for that last two years could keep the country in the dark this holiday season.

Eskom, the state-owned supplier of 95% of the country’s electricity, is warning it may need to switch off the power periodically starting this month till the end of the year to protect the country from a total blackout. Eskom triggers so-called load-shedding when it anticipates being unable to satisfy demand.

Ten of the 15 coal-fired power stations that supply the country’s energy grid have less than 20 days’ supply of coal remaining; five of the 10 stations have less than 10 days’ supply, Eskom said at a briefing on Friday. South Africa depends on coal for 70% of its energy needs.

“There will be no blackouts during the festive season, but the risk of rotational load-shedding is high,” said Willy Majola, Eskom’s acting group executive for transmission.

Eskom started and then stopped load-shedding on Sunday, citing “sufficient progress” with regard to emergency reserves.

Officials are scrambling to purchase an additional 4 million tons of the mineral in a bid to keep the lights on. And they blame the shortage in part on the failure of mines purchased by members of the Gupta family at the heart of the so-called state capture inquiry.

Double-dealing between the Guptas, who are close friends of former President Jacob Zuma, and the former CEO of Eskom led to the family becoming one of Eskom’s main suppliers of coal.

Eskom attributed the current shortage at two of its power stations to the failure of mines owned by Tegeta, a Gupta-controlled firm that declared bankruptcy in February. The stations, both located in South Africa’s Mpumalanga province, relied exclusively on Tegeta mines for coal.

Prior to its failure, Tegeta had committed to supply about one-twelfth of the 10 million tons of coal that Eskom uses each month, according to Ted Blom, a senior adviser with the Energy Expert Coalition, an independent watchdog group.

The likelihood of load-shedding marks the latest in a nearly two decade-long struggle by Eskom to obtain enough coal to meet the demand for electricity.

Part of the challenge ties to an uptick in demand that followed the government’s extending the grid to households in rural areas. But the problem also stems in part from under-investment by Eskom in new mines, according to Blom. He notes that Eskom itself estimated in 2009 that it would need at least 40 new mines to prevent shortages over the long term. Since then, the price of coal has quadrupled to roughly 1,000 rand ($71.40) per ton.

Eskom also attributes the latest shortage in part to the soaking of stockpiles by rainfall at open pit mines, together with problems sourcing coal of sufficient quality.

South Africa’s steps to reduce its reliance on greenhouse gas emissions over the long term are taking a toll as well. In April. the government signed contracts for renewable energy worth 50 billion rand ($3.6 billion). Each hour of energy from solar and wind translates to an hour less of energy from electricity sold by Eskom.

Despite Eskom’s announcing a nine-point recovery plan, the problems don’t seem to be going away. Blom expects the utility to collapse completely by March. “The problems will be so big they’ll be insurmountable,” he predicts.