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By Paul Burkhardt
With South Africa enduring record power outages, the government has given assurances that the electricity grid won’t be allowed to collapse. Yet increasing numbers of businesses are preparing for that very eventuality.
Mining and telecommunications companies, retailers and private hospitals are spending millions of rand on batteries, solar panels and generators to safeguard their operations as the electricity supply from state utility Eskom Holdings SOC Ltd. grows increasingly unreliable. More than half of its generation capacity has been regularly unavailable, leading to blackouts of up to 12 hours a day.
A total grid collapse isn’t “highly probable, but you have to plan for that,” Ralph Mupita, chief executive officer of MTN Group Ltd., Africa’s largest wireless carrier, said at an investor presentation this week.
While unlikely, here’s how a grid collapse could unfold:
Eskom protects the system from collapse by implementing rotational power cuts and reducing supply to industrial customers. However, a massive unanticipated breakdown of generation units or wide-scale transmission faults could cause the electricity frequency on the grid to drop below minimum required levels, overwhelming the system and causing it to shut down in its entirety, Gav Hurford, Eskom’s national control manager, said in a 2021 video.
The ensuing outage could last anything from days to weeks and “would be catastrophic,” with a risk of looting, vandalism and public unrest, according to Eskom. It cites the experience of Venezuela, whose economy was crippled by an extended blackout in 2019, as the closest example of what South Africa could expect.
In a recent court filing, Eskom warned that disruptions to water supplies and sewage systems — which have already been affected by the rotating power cuts that cause pumps to malfunction — could become more prolonged and widespread should the grid go down. It also anticipates fuel shortages, which would have a knock-on effect on transport and industry, as well as on hospitals, laboratories and morgues that rely on backup generators.
Hurford envisions fuel stocks becoming depleted within days, rather than weeks, and that the backbone of the nation’s telecommunication systems would start to fail within eight hours.
Mining operations are also likely to be disrupted, although companies have installed generators that could be used to continue running their ventilation systems and haul workers in some of the world’s deepest shafts back to the surface.
Eskom has generating units known as black-start facilities that can operate independently of the grid. Those could be used to fire up other power stations and gradually restore them to service. Restoring the entire system could take as long as two weeks, according to Hurford.
“A blackout is a risk that South Africa cannot afford to take,” Eskom said. “It is no exaggeration to say that it would, in all likelihood, be a monumental and unprecedented national catastrophe that would threaten many lives.”
The utility has repeatedly stated that it will take the necessary steps to prevent the grid from going down.
With assistance from S’thembile Cele and Loni Prinsloo.
© 2023 Bloomberg L.P.
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