The content on this page is not written by Polity.org.za, but is supplied by third parties. This content does not constitute news reporting by Polity.org.za.

Despite Eskom's investment in new generation capacity, South Africa will face tight electricity supplies throughout 2012 and 2013, pending the completion and coming on line of the first of six generation units at the Medupi power station. Until then, Eskom will periodically limit the electricity supplies to large industrial consumers, with Eskom compensating these industrial consumers for loss of productivity.

The effects of these supply limitations are already visible. Merafe Resources, for example, experienced a 21% decline in output from its joint venture with London listed Xstrata in the first quarter, largely due to cuts in electricity supply. In this instance, Eskom has secured an agreement with Xstrata-Merafe chrome ventures to temporarily shut down five of its furnaces to assist Eskom in meeting the country's power demands.

Ferrochrome producer Ferro Metals has also agreed to take part in Eskom’s electricity buy-back programme between March and May. A total of 130 000 tons worth of production could be lost as a result of these shutdowns at Ferro Metals.

In 2007 and 2008, South Africa already experienced a near-complete grid shutdown which grounded and halted activity in mines, smelters and other big business for days at a time. This costing the South African economy billions of rands and thousands of jobs.

While demand is constantly growing, most of the country's power infrastructure is ageing and being operated at a higher intensity with less planned maintenance downtime. The risk of unplanned outages thus continues to increase. We need to get Medupi up and running and soon as possible to mitigate the risk of another grid-wide shut down and the associated economic damage.