A two-month pause in South Africa’s rolling power cuts should have been a call for celebration. Instead, it has ignited debate over how it could boost support for the country’s embattled ruling party ahead of the national election on May 29.
The timing has led to widespread speculation that officials—at an enormous cost to the budget—are intervening in the electricity market to shore up support for the African National Congress (ANC), which risks losing its majority for the first time since the advent of democracy in South Africa three decades ago.
The turnaround at Eskom, the state-owned power utility which has struggled to maintain a steady supply of electricity since 2007, has indeed been dramatic.
Last year, scheduled blackouts, known locally as load shedding, reached record levels and cost the already floundering economy about $90 billion and over 860,000 jobs—particularly hitting its mining and manufacturing sectors. At the micro level, too, South Africans have had to mould their lives around daily power cuts.
Over the past five years, the worsening energy crisis has threatened the survival of businesses—including KFC, the popular American fast-food joint—and required costly fixes for companies that need a steady supply of electricity. Grocery retailer Shoprite recently reported spending $28 million in six months on diesel generators to keep its lights and refrigerators on.
Power cuts have also exacerbated the country’s crime problem, with reports of increased home burglaries in areas that are temporarily disconnected from the grid. Today, smartphone apps such as EskomSePush and Load Shedding Notifier, which provide alerts about impending blackouts, rank among the most downloaded apps in the country.
Owing to incessant breakdowns across the country’s fleet of aging coal-fired power stations, it is estimated that the average citizen spent a fifth of last year without electricity.
Thus, to partially cover the shortfall in electrical output in 2023, Eskom ramped up its use of costly diesel-powered generators, further compromising its already unsustainable financial position. According to Eskom’s latest annual report, the unit cost of electricity from diesel generators is 14 times higher than the utility’s coal plants.
Even so, the heavy reliance on diesel continued into the new year. However, in late March, Eskom announced a suspension of load shedding, thus, sparking confusion. Opposition parties, including the Democratic Alliance, and other commentators are wary of “political interference” and believe that Eskom may be engineering a short-term fix to ratchet up support for the ANC in the run up to voting day.
To many, the skepticism is warranted given Eskom’s checkered past. Even the utility’s former CEO, Andre de Ruyter—who exposed endemic corruption when at the helm but quit the job in early 2023 after being poisoned with cyanide-laced coffee—has said the only plausible explanation is that diesel is being burned “at a rate of knots.”
In a televised interview last year, de Ruyter said that Eskom loses more than $55 million every month to theft, thanks to organized cartels that operate freely within the utility and dodgy procurement deals (an audit by his team found that the company paid over $11,000 for a single mop).
But data from Eskom’s system operator tells a different story about the recent load shedding-free streak. Though the utility’s diesel consumption was particularly high in the first 12 weeks of the year, it fell sharply when blackouts were suspended in March. Since then, use of the fuel has been well below the same periods in 2023, and even 2022.
Instead of running them almost constantly, as it did last year, Eskom is now using its diesel-powered turbines for their intended purpose only: to help meet surges in demand during the morning and evening peak periods.
According to Eskom, it spent 1.1 billion South African rand, or roughly $60 million, on diesel last month, a notable decline from the 3.1 billion rand spent in the same month a year before. Analysts are confident that the utility is being truthful, pointing out that the country’s electricity supply has increased materially in recent months while demand has shrunk.
Most notably, Eskom has brought several units of the Kusile power plant, located in the Mpumalanga province, back online. Though the facility has been under repair, the utility was granted regulatory approval to temporarily operate those units without technologies that prevent toxic sulfur dioxide emissions. This has effectively increased Eskom’s available generating capacity by as much as 2,100 megawatts (MW), which is more than the average supply deficit throughout 2023.
In addition to Kusile, the rest of the utility’s coal fleet is in slightly better shape thanks to increased maintenance over the summer months—between October and March—when electricity demand is typically below average. Both of these have contributed to a meaningful decline in the number of unplanned outages in recent weeks.
Meanwhile, a decrease in overall demand, owing to the weak economy and a boom in private renewable energy investments, has also helped. Eskom estimates that solar panels with a cumulative generating capacity of 5,500 MW have now been installed on the roofs of South Africa’s malls, office blocks, warehouses and households. Of that amount, roughly 2,100 MW was added in the last year alone—the vast majority of which is for self use as the country doesn’t yet have a national feed-in policy.
According to independent energy analyst Clyde Mallinson, total demand for Eskom’s electricity has declined by around 1,400 MW on average, over the past year. He estimates that 30 percent of that is due to reduced consumption from industrial firms, such as steel producers, and from mining groups, including platinum miners, which employ some 182,000 people but have struggled amid a pullback in prices of the metal.
All things considered, the timing of the break in load shedding is merely “coincidental,” Mallinson said. But the communities near the sulfur dioxide-spewing Kusile power plant are still paying the price.
James Mackay, chief executive of the Energy Council of South Africa, a business group that is working with the government to resolve the power crisis, agreed, saying the reprieve “is not electioneering—it’s a genuine shift.”
The improvement is the result of “18 months to two years of hard work,” Mackay said, and reflects renewed efforts to clamp down on corruption, a fresh Eskom leadership team that has political support, an improved culture at the utility, and a stronger maintenance program. The private sector’s involvement, partly in the form of capacity building, is also making a difference.
While the country’s electrical grid remains vulnerable and load shedding is expected to return at some point, power cuts will be less severe going forward, Mackay predicted.
Until then, the ANC is benefiting from a partial recovery in support at just the right time.
In a national poll conducted by the Social Research Foundation in March 2023, 41 percent of ANC supporters said load shedding had forced them to reconsider their support for the party once led by Nelson Mandela. And a quarter said they would not vote for the party if it did not fix the country’s electricity crisis by election day.
“The lights being on has created a fortuitous campaigning environment for the ANC,” said Frans Cronje, director of the Social Research Foundation.
Last month, the party’s support dipped slightly below 40 percent for the first time ever, polling showed. But the latest surveys show it is creeping back up towards the 50 percent mark. The recovery is only partially attributable to the pause in rolling blackouts, Cronje said.
Since 2004, support for the ANC has been steadily declining, as voters remain frustrated over the country’s rising unemployment and poverty rates as well as the numerous corruption scandals that have plagued the administrations of President Cyril Ramaphosa and his predecessor, Jacob Zuma.
Still, the party typically manages to win back some voters in the weeks before every election through an intensive door-to-door campaign. Yet Cronje says the “glacial trend” shows support for the ANC will continue to decline until the next election in 2029—even if load shedding is consigned to the history books.
By that time, South Africa will have liberalized its electricity sector and closed the chapter on Eskom’s century-long monopoly, according to a piece of legislation that may be signed into law before May 29.
Though the state has long resisted calls to allow for a competitive power market, Eskom’s dire financial situation and inability to keep the lights on has finally forced its hand.
The Electricity Regulation Amendment Bill is aimed at modernizing the country’s power sector by allowing non-Eskom electricity trading for the first time and requiring the establishment of a fully competitive wholesale market within five years.
That is an ambitious timeline, according to Mackay, who says the partnership between the government and the private sector will need to hold firm to ensure an orderly transformation of the power sector. Mackay adds that as South Africa moves beyond its era of energy insecurity, it will need to be transparent about its plans to decommission coal plants.
The government has suggested it will have to delay plant shutdowns for the foreseeable future, in spite of the blockbuster $8.5 billion energy transition funding deal it agreed to at the COP26 climate conference in late 2021.
“We have said we will transition to cleaner energy, but at our own pace and own time,” President Ramaphosa said last year. “We have got to do it, taking into account the needs of our people and the requirements of energy security.”
Though it is too early to declare victory, Eskom’s recent turnaround provides an opportunity to accelerate South Africa’s green energy ambitions, according to Mallinson. Doing so would help the country to cushion the economic blow of the European Union’s impending carbon border taxes—as things stand, South Africa will be hit harder than any other nation due to its unusually heavy reliance on coal.
While the transition is expected to open up new opportunities for South Africa to become a supplier of low-carbon steel and other goods, it will need to be carefully managed, with over 120,000 people working in the coal sector. The just transition program agreed at COP26 includes funding to reskill these workers and develop new industries in their communities, but progress to date has been slow.
President Ramaphosa wants to attract private-sector investment worth $110 billion in the next five years as South Africa leans more on its BRICS partners—including China, India and Russia—while also seeking to maintain close ties to the United States, the U.K., and Europe. But to successfully court investors and reignite the moribund economy, South Africa needs to finally close the chapter on its load shedding nightmare.
