Eskom’s new crisis is out of its control

South Africa’s load reduction crisis may prove more difficult to solve than load-shedding, with the solution largely in the hands of municipalities who manage a significant part of the country’s distribution infrastructure. 

Failing municipalities across South Africa have not invested enough in expanding and maintaining distribution infrastructure, resulting in load reduction. 

Load reduction is not load-shedding in another form, as it does not stem from a supply-demand imbalance, but rather an inability of the infrastructure to handle sufficient load. 

Electricity Minister Kgosientsho Ramokgopa has urged Eskom to shift its focus towards this crisis and engage with municipalities as to how it can be solved. 

Eskom’s efforts to reduce load-shedding have enabled it to begin focusing on other areas of South Africa’s electricity sector, such as load reduction. 

As demand for electricity has increased with population growth and migration, parts of the country have been hit with load reduction or blackouts due to infrastructure failures.

In most cases, these failures are due to inadequate investment in new infrastructure or maintenance of existing equipment. 

“There is a direct relationship between failing municipalities and load reduction. You have a situation where municipalities are unable to collect revenue to deploy into infrastructure,” Ramokgopa told the SABC. 

“We are increasingly seeing that, as a result of an economy that is not performing, and electricity tariff increases that people are unable to pay. That results in the kind of crisis that we are experiencing now.” 

Ramokgopa said that municipalities are owed over R400 billion by South Africans and, as a result of this inability to collect revenue, they cannot invest in local services. 

Municipalities are also increasingly unable to pay Eskom for the electricity they use, resulting in them owing the utility over R100 billion. 

Ramokgopa warned that the situation is unsustainable, with the government working on a possible intervention to tackle the rise of load reduction and municipal decline. 

“There are 1.5 million customers in South Africa that are subjected to load reduction and so, when we say there is no load-shedding, those people cannot relate to that,” Ramokgopa said. 

“In the mornings and in the evenings, they are subjected to load reduction, and so we are introducing a plan on how we are going to deal with this.”

Under this plan, Eskom is set to directly intervene in local municipalities by providing the skills required to refurbish and upgrade infrastructure. 

However, this plan does require the buy-in of municipalities and a resolution to the municipal debt crisis from the National Treasury. 

Despite these hurdles, Ramokgopa expects the load reduction crisis to be solved within the next 18 months. It would be solved faster if there is cooperation from communities, he said. 

Not everything is rosy 

Ramokgopa has previously said that resolving the load reduction crisis could be far more difficult than load-shedding, given its dispersed nature. 

It is far easier to deal with issues at 14 power stations in certain parts of South Africa than hundreds of substations or pieces of equipment all over the country. 

Speaking at Eskom’s most recent State of the System briefing, Ramokgopa praised Eskom for tackling load-shedding but warned that new fronts are opening for the utility. 

“These men and women have done exceptional work in turning this organisation around. We are exceptionally buoyant about what the immediate future looks like,” Ramokgopa said. 

“But it is not all rosy, and it is not all an Eskom problem. There are problems that are the responsibility of the executive authority that sits in the ministry.” 

Eskom’s efforts to bring load-shedding to an end have opened new fronts for the utility and ministry to address. 

The major new front Eskom and the ministry will have to tackle is load reduction, which has become a substantial problem in South Africa.

Ramokgopa previously warned that the collapse of distribution infrastructure threatens the utility’s progress on load-shedding. 

Critics have argued that the ongoing reforms in South Africa’s electricity sector are paying little attention to the vital area of distribution infrastructure.

Due to provision obligations in South Africa’s Constitution, municipal governments play a key role in the electricity sector, distributing around 40% of all electricity. 

Municipal governments primarily serve households and small businesses, with the remaining 60% of users being served by Eskom, which caters to large users and municipalities without a network. 

“Load reduction is a failure at the level of Eskom and municipalities to provide sufficient infrastructure and capacity to accommodate load growth in particular areas,” Ramokgopa previously said. 

This has largely been driven by the emergence of informal settlements in parts of South Africa, typically on the edges of cities, that have created unexpected additional demand. 

“We have not kept up with that by renovating and expanding the capacity of distribution infrastructure in parts of South Africa,” Ramokgopa said.

Municipalities, under the current arrangement, are charged with maintaining infrastrucutre, providing new connections, and setting minimum service levels. 

Many of them fail in these duties and struggle to provide reliable electricity services to their constituents. 

In recent years, numerous outages and equipment failures have occurred at this level, exacerbating load shedding, as municipalities lack the funds to adequately maintain their infrastructure.