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Wage protests threaten South African power supply

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Wage protests threaten South African power supply

Photo by Bloomberg

14th June 2018

By: Reuters

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About 1 000 union members picketed Eskom's headquarters on Thursday in a wage dispute that threatens the cash-strapped South African utility's ability to deliver power.

There have been no reports of outages in Africa's most industrialised economy, but Eskom said that some plants had cut output, with shortages more likely now during peak winter demand.

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Labour unions have threatened a "total shutdown" of Eskom's operations if it does not meet their demands for a 15% increase in salaries.

The pickets come a day after protests at about 10 Eskom power plants forced the utility to switch off some generating units because trucks carrying coal and buses ferrying staff were blocked from entering.

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Eskom, which produces more than 90% of South Africa's power, narrowly avoided a liquidity crunch early this year and was embroiled in corruption scandals.

The picketing workers demanded to be addressed by Eskom Chief Executive Phakamani Hadebe, and about 12 police cars were stationed outside the company's Megawatt Park headquarters to protect Eskom staff and equipment.

The National Union of Mineworkers (NUM) and National Union of Metalworkers of South Africa (NUMSA), who say they represent more than 20 000 of Eskom's 47 000 employees, warned that thousands of their members would picket at Megawatt Park.

Thabiso Masha, an Eskom employee who works in the research department in Germiston, said: "Zero% is nonsense, we won't stand for it. Petrol is going up, VAT is going up, so our pay is decreasing".

Another employee, who works in Eskom's distribution operation in Johannesburg but asked not to be named, said: "It's not the workers' fault that the company is suffering because of corruption. We are not the root cause ... They are preparing for job cuts."

Two workers held up a placard emblazoned with "0% equals 0 Megawatt". Another read: "To hell austerity measures. Workers cannot pay for sins of management."

'SABOTAGE'
Eskom spokesperson Khulu Phasiwe said that some power stations were not generating at full capacity because of "acts of sabotage and intimidation".

"There have been several incidents of road blockades, attacks on staff and wilful damage of electricity infrastructure. As a result, all road coal deliveries have been stopped for security reasons," Eskom said in a statement.

Stabilising Eskom's finances is a priority for President Cyril Ramaphosa as he looks to rekindle growth after nine years of stagnation under his predecessor, Zuma.

Ramaphosa oversaw the appointment of a new board and chief executive at Eskom in an attempt to clean up governance and set the company on a firmer financial footing.

Separately, South Africa's energy regulator Nersa gave Eskom the go-ahead to recover R32.69-billion ($2.5-billion) of costs incurred over the past three years through higher tariffs, about half what the utility had requested.

Eskom said it would study the decision before commenting.

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