Blackouts back on Eskom radar as capacity shortage looms

By Colleen Goko

(Bloomberg) – Eskom Holdings SOC Ltd., which produces most of South Africa’s power, said on Sunday that controlled blackouts will return because of a shortage of capacity.

The utility is cutting 2,000 megawatts from the grid from 1pm in Johannesburg until 10pm, Eskom said in a statement. It’s also replenishing and preserving emergency water and diesel to limit the possibility of further outages in coming days.

Read also: More reasons why Eskom is limping along – Chris Yelland

Blackouts became familiar in 2008, and again in 2015, when Eskom implemented months of the outages known locally as load shedding. The cuts hamstrung the economy, limiting industrial output and hurting business and consumer confidence.

In his annual State of the Nation speech, President Cyril Ramaphosa last week vowed to rescue Eskom after it suffered massive losses and piled on debt, saying that a split into generation, distribution and transmission businesses will enable each unit to manage its costs more effectively and make it easier for them to raise funding. Eskom is seen by rating companies as a key risk to Africa’s most-industrialised economy, with blackouts and huge debt a drag on growth prospects.