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South Africa’s Solar Expansion Puts Pressure on Eskom’s Finances

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South Africa's Solar Expansion Puts Pressure on Eskom's Finances

South Africa has experienced a substantial increase in rooftop solar power generation, which has had significant financial implications for Eskom and local municipalities. This surge in solar energy adoption, driven by frequent power outages, has raised concerns about the potential privatization of the energy sector.

South Africa’s Solar Expansion Puts Pressure on Eskom’s Finances

Rapid Growth in Rooftop Solar

Recent data from Eskom reveals that from March 2022 to the first quarter of 2023, small-scale embedded generation (SSEG) in the form of solar panels has surged by 350%. This growth reflects a collective effort to combat power outages in the country.

Financial Impact on Eskom and Municipalities

The increased adoption of solar panels has come at a cost for Eskom and municipalities. Eskom, in particular, has seen a 2.3% reduction in sales, translating to a significant loss in revenue. For instance, the Buffalo City Metropolitan Municipality reported a revenue loss of R350 million due to decreased electricity sales.

Implications for Privatization

Experts believe that the utility sector, including Eskom, may inevitably shift toward privatization due to these financial challenges. While not a formal privatization policy, the private sector is gradually assuming the responsibilities previously held by the state, particularly in distribution and partially in generation.

Transition to Private Electricity Generation

According to data from RMB Morgan Stanley, the private sector is expected to generate more electricity than Eskom by 2025. This indicates a long-term trend towards private electricity generation, with Eskom transitioning into a distributor rather than a primary generator.

Economic Analyst’s Perspective

Economist Dawie Roodt characterizes this shift as a “back-door privatization” where Eskom’s distribution network and a portion of its generation fleet become privatized. However, this transformation is seen more as a consequence of state collapse than a deliberate privatization policy.

Timeline for Changes

While the privatization process is expected to continue, significant changes may take 18 to 24 months to materialize. In the future, Eskom is likely to focus on electricity distribution and procurement from other entities, marking a fundamental shift in South Africa’s energy landscape.

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Eskom Loadshedding will continue until 5:00 on Tuesday, as previously announced

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Eskom Loadshedding will continue until 5:00 on Tuesday, as previously announced

Until 05:00 on Tuesday, stage 4 loadshedding will continue. Until further notice, Stage 2 and 4 loadshedding will take place.

Eskom Loadshedding will continue until 5:00 on Tuesday, as previously announced

Monday, 10 July 2023: Stage 4 loadshedding is being implemented until 5:00 a.m. on Tuesday due to increased demand. On Wednesday, Stage 4 loadshedding will be implemented from 14:00 until 05:00, followed by Stage 2 loadshedding from 05:00 to 14:00.

Eskom Loadshedding Today

There will be a daily implementation of this pattern until further notice. A new update will be published if any significant changes are made.

As of now, 14 252MW of generating capacity has been damaged by breakdowns, while 4 118MW of generating capacity has been out of service for planned maintenance.

As of today, Duvha, Hendrina, Kendal, Kriel, Matimba and Medupi power stations have each reactivated a generating unit.

The Arnot and Tutuka power stations each had a generation unit out of service due to a breakdown during the same period.

Tutuka Power Station’s current capacity constraints are due to the delay in resuming two generating units. In order to restore service to the generating units, Eskom teams are working around the clock.

Members of the public are being encouraged to use electricity sparingly and efficiently, and we want to thank the people who do heed the call. During the period between 17:00 and 21:00, please turn off your geysers and pool pumps as this reduces demand, alleviates pressure on the power system, and contributes to fewer stages of load-shedding.

For Further Notice Visit Official Site 

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