South Africa's power grid under strain, diesel a concern

South Africa‘s power grid is under significant pressure and reserves are expected to be “very tight” next week as more businesses reopen after the holiday season, a spokesman for power utility Eskom said.

Andrew Etzinger said on Wednesday that reserve margins at the moment were “virtually zero” and the likelihood of power cuts on Wednesday was 60-70 percent after two generators tripped in the morning.

Eskom is scrambling to keep the lights on in Africa’s most advanced economy as power demand threatens to outstrip capacity, raising the prospect of rolling blackouts.

South Africa last year suffered its worst power outages since 2008 due to creaking infrastructure, power plant failures and emergency maintenance.

Etzinger said if the cash-strapped utility were unable to purchase diesel supplies for its gas-fired power stations, Eskom would lose 5 percent of its capacity and blackouts would then occur on an almost “daily basis” until the end of March.

He stressed that was a “worst-case scenario” and said the government was working with the state-run company to find funding solutions.

Even with a R20B ($1.7B) cash injection from the government and permission to raise electricity tariffs, Eskom has said it needs more funds to ensure liquidity.

Etzinger said the sliding price of oil, which fell below $50 a barrel on Wednesday for the first time since early 2009, was a relief to the utility and would help in its quest for diesel.

But even with an adequate supply of diesel, rolling blackouts from now to the end of the southern hemisphere summer in April remained likely, he said.

“It’s unlikely that we will come to the end of summer without some form of load shedding,” he said, using the local term for power cuts.

Eskom does much of its maintenance in the summer so it has better reserves during winter when demand for power peaks.

Controlled power cuts are used to prevent a total collapse of the grid and Eskom regularly appeals to South Africans through television campaigns and social media to reduce electricity use.

Source: South Africa's power grid under strain, diesel a concern | Reuters.