Will South Africa’s Power Crisis Sink Its Green Ambitions?

In Brief

Will South Africa’s Power Crisis Sink Its Green Ambitions?

A devastating power crisis is plaguing South Africa, battering its economy and threatening to sink its climate goals amid the global race to renewables.

South Africa has struggled with power shortages for years, but its deteriorating grid threatens economic turmoil and social unrest ahead of looming elections next year. Meanwhile, aging coal power plants are becoming more expensive and less reliable, and the country’s public utility, Eskom, is hampered by debt, corruption, and sabotage. Now, the question facing South African policymakers is if the country can get its lights back on while tackling ambitious plans to escape its coal dependence that has driven it to become Africa’s top greenhouse gas emitter.

What’s happening with South Africa’s power supply? 

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Since 2007, Eskom has been forced to ration power through intentional blackouts, known as “load-shedding,” to avoid a collapse of the power grid. Load-shedding has reached record highs in recent months, with residents enduring twelve-hour daily blackouts. As the country enters its energy-intensive winter season, some analysts predict outages could surpass sixteen hours a day.

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The impact of power instability is widespread, including limited hospital services, increasing food and water scarcity, rising bankruptcies, worsening crime rates, and unemployment exceeding 30 percent. South Africa’s central bank warns that load-shedding is poised to cost the economy nearly $13 billion this year. As the most industrialized economy on the continent, South Africa’s power woes are dragging down growth among its neighbors. Analysts say that prolonged blackouts will also threaten serious social and political unrest ahead of upcoming national elections in 2024.

Protesters march to the Eskom headquarters in Johannesburg demanding an end to load-shedding.
Protesters march to the Eskom headquarters in Johannesburg demanding an end to load-shedding. Maria Guilia Trombini/AFP/Getty Images

What’s behind the problem?

Eskom is Africa’s largest power producer, but experts say it is woefully mismanaged. The utility has borne decades of underinvestment, frequent leadership turnover, and mounting debt leading to repeated government bailouts. The result is a fleet of aging power plants, mostly coal, that are increasingly unable to meet the country’s energy needs, which can reach thirty-five gigawatts during peak demand. The amount of energy these plants actually deliver has fallen to as low as 50 percent of their nominal capacity at times. Even the newest coal plants are struggling due to design flaws, long construction delays, and cost overruns. 

The country seeks to phase out twelve gigawatts of coal power in the next decade while adding another eighteen in renewables. But new power projects are not coming online at the necessary rate, bogged down in bureaucratic red tape and political resistance to the transition to renewables, says David Walwyn, professor emeritus at the Graduate School of Technology Management, University of Pretoria.

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Eskom also struggles with endemic corruption; its infrastructure and coal supplies often face internal sabotage by individuals looking to contract repair work at inflated rates, and theft by those looking to sell the stolen parts. Some analysts speculate that the sabotage is linked to efforts to undermine the energy transition: former Eskom CEO André de Ruyter believes that a recent attempt on his life stemmed from opposition within the utility against his plans to move away from coal.

What’s the government doing about it? 

President Cyril Ramaphosa ran on an anti-corruption platform in response to widespread graft under his predecessor President Jacob Zuma. However, experts say Ramaphosa has struggled to grapple with the scale of the problem, and that the actions he has implemented to date have not been effective in confronting Eskom’s governance issues. 

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Ramaphosa’s administration has said it will focus on repairing existing coal plants, and that it could delay the planned closure of others. He instituted a state of disaster from February through April of this year, which allowed him to streamline decision making about Eskom, provide extra support to businesses, and exempt critical infrastructure such as water plants and hospitals from load-shedding. He also mobilized the military to protect Eskom infrastructure and created a new electricity minister position to try to improve the utility’s governance. 

The government has lifted a cap on private energy development, which experts say could lead to more renewables. Walwyn says other possible reforms could include reducing political control over Eskom, allowing for more private power generation, or privatizing some of Eskom’s assets. Ramaphosa has backed long-standing plans to break Eskom into separate companies handling power generation, transmission, and distribution; those efforts have so far stalled

Some advocates assert that more nuclear power could fill the power breach and replace coal, though it would be 2030 at the earliest before any new nuclear facilities could come online. Plans for an additional fifty gigawatts of private renewable energy will also take until 2030 to implement. In either case, the grid alone will need at least $11 billion of investment to handle the additional renewable power.

What does this mean for South Africa’s clean energy goals?

South Africa’s coal reliance makes it the continent’s biggest greenhouse gas emitter. The coal sector directly employs more than 120,000 people and indirectly supports at least 2.3 million people. Analysts say the country has great potential to tap into renewables, given its vast solar and wind resources, though Eskom’s dedication to coal technology raises significant barriers. 

In 2021, the Just Energy Transition Partnership (JETP) was announced to help South Africa overcome these obstacles. A group of Western countries pledged $8.5 billion in financing for decarbonization targets, including goals to decommission ten thousand megawatts of coal energy while adding more than twenty thousand megawatts in renewable capacity by 2030 and plans to become a net-zero emissions economy [PDF] by 2050. 

But experts note that the transition remains daunting. JETP’s $8.5 billion commitment pales in comparison with the estimated $250 billion cost of reaching net zero, and its terms remain unclear. Some analysts also question the agreement’s reliance on loans rather than additional aid. Others point out that Eskom, which has committed to repurposing coal stations into renewable plants, is currently barred from taking on further loans under the terms of its latest bailout.  

Despite these challenges, there are major investments in renewables underway. Newly registered projects this year total three gigawatts, with another thirteen in the pipeline. But experts warn that if South Africa isn’t able to keep the lights on, the likely breakdown of public order and further erosion of state capacity will put the country’s clean energy hopes even further out of reach.  

Will Merrow contributed to the graphic for this In Brief.

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