Dawie Roodt’s load-shedding warning

The load-shedding relief over the past month could positively affect economic growth this year, but the elections and a downturn in Eskom’s performance could mean economic growth of far less than 1% in 2024.

This is the view of Efficient Group chief economist Dawie Roodt, who told SABC News that South Africa could see growth of above 1% this year.

His comments come as Eskom’s improved performance has seen load-shedding suspended for the past 40 days – the longest South Africa has gone without load-shedding since 2022.

The utility attributed its improved performance to fewer unplanned outages, lower demand, increased supply from renewables, and the return of three Kusile generation units to the grid.

Roodt said that if Eskom can maintain the current level of electricity provision, the South African economy will react positively. It could even see economic growth of over 1% or 1.2%.

However, he warned of two variables that could impact this growth – load-shedding and the elections.

South Africans are set to vote on 29 May this year in a national election that could see the ANC lose its majority for the first time since it took power.

This could see the ruling party having to form a coalition with opposition parties, which many experts have said could be disastrous or have little effect on governance, depending on the coalition.

Roodt also emphasised that the outcome of this year’s election will be crucial to the economy’s performance.

The other variable that could make or break South Africa’s economic growth this year is Eskom’s performance.

If this current supply is maintained, the economy could flourish. However, if Eskom goes back to
“business as usual”, it could severely hinder growth.

“If we go back to business as usual and we’re at stage 3, 4 or 5 load-shedding, then economic growth is unlikely to see 1%. I think it will be well below 1% this year if we go back to normal,” he said.

Professor Hartmut Winkler from the University of Johannesburg previously warned that load-shedding will return despite lower demand from South African businesses and households.

Winkler told SABC News that the load-shedding reprieve over the last few weeks is due to South Africans using less power.

Electricity demand is 6% less in 2024 than in 2023. This is partly because many businesses and households have installed rooftop solar.

Another change from last year is that three generating units at the Kusile Power Station returned to service.

These units generate 2.4 GW if they operate at their peak capacity, eliminating two load-shedding stages.

However, with electricity demand set to spike as the country enters the winter period, load-shedding will return.

During winter, the electricity demand in South Africa is around 6 GW higher than during summer.

During its Winter 2024 Outlook presentation, Eskom said South Africans may see load-shedding this winter, but it will likely be limited to stage 2.

Winkler said this is an optimistic view, adding that he expects South Africa to oscillate between stage 1 and 3 during winter.

He also dismissed speculation that the load-shedding reprieve is linked to the 2024 general elections on 29 May.