• South Africa’s electricity crisis is a disaster for the country.
  • Due to the prohibition on Eskom building a new generation plant, the “reserve margin” – which is a gap between Eskom’s maximum generation capacity and electricity demand – fell to 15% in 2001 and further went down to 7% in 2008.
  • Also fuelling the electricity crisis was Eskom’s failure at keeping the existing kit running at adequate levels, a deterioration in the reliability of coal supply and the quality of coal supplied.
  • To avoid prolonged blackouts in the future, the South African electricity industry needs to secure the coal supply by reversing the deterioration of the rail and road infrastructure through which coal is transported to Eskom’s major power stations; contract private sector cogeneration and independent power producers as suppliers of coal; and increase the price of electricity.
  • Accountable and responsible governance structures must drive the direction of the electricity industry.
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