Johannesburg - President Jacob Zuma is under the spotlight to provide leadership and shed light on ending the power crisis that is crippling the economy.
With rolling power cuts becoming commonplace across the country, businesses and households alike look to the president to give assurance, during the state of the nation address, that the government is on top of the situation.
Zuma is expected to unveil a rescue plan that was approved by the ANC national executive committee and cabinet makgotla.
Economists and analysts have warned about the far-reaching effects of the power crisis on the economy and livelihoods of South Africans, but the president’s address will provide a platform for him to offer a way forward.
The country’s power crisis featured strongly at the cabinet lekgotla chaired by the president last week, and the outcomes of those deliberations should be reflected in his address.
The cabinet gathering followed the ruling party’s national executive committee (NEC) lekgotla, where the power crisis was partly attributed to the growth and development in South Africa since 1994.
The ANC lekgotla had instructed cabinet to prioritise projects that could bump up the supply of power to the national grid over the next 18 to 24 months.
The governing party also urged cabinet to accelerate the nuclear energy programme.
ANC secretary-general Gwede Mantashe on Saturday refused to be drawn on what should be expected from Zuma’s speech on Thursday, saying it would be informed by the NEC and cabinet processes that took place over the last few weeks.
Eskom this week moved into stage three of load shedding, plunging suburbs and townships across the country into darkness at regulated intervals. The power cuts have resulted in serious traffic chaos across the province, with businesses among those mainly affected as many have had to shut their doors.
Business leaders warned this week that the continuous load shedding was negatively affecting business confidence in the country, with the official opposition calling for an end to Eskom’s monopoly in the energy sector.
DA parliamentary leader Mmusi Maimane said: “If Zuma was serious about ending the electricity crisis soon, there are a number of steps he could announce right away to start turning the ship around.
“Thursday evening presents the perfect opportunity for him to do so and we will all be holding our collective breath. The South African economy, having lost an estimated million jobs to load shedding, is in desperate need of some key interventions.”
Maimane called for independent power producers to be allowed to add additional capacity to the power grid.
“Opening the grid, in a meaningful way, to independent power producers is key to solving our electricity generation shortfall. There is certainly no shortage of project proposals for co-generation, and with every round of bidding, the cost has come down,” said Maimane.
Cosatu president S’dumo Dlamini said the labour federation was not expecting a “magic wand” for the power crisis from the president’s address, but said the nation needed assurance from the president that the issue was being dealt with.
According to Dlamini, there was a need for deadlines related to power stations being built to be met, and Zuma would have to assure the nation this would be done.
“We need a word of assurance from the president and to emphasise announcements that have already been made around this issue.
“Though we do not expect him to immediately fix the problem, we want to hear him saying that the project deadlines for Khusela and Medupi power plants will be met without any further delays.
“We are also looking forward to hearing how we are going to respond to the economic crisis we have in this country,” said Dlamini.
The SA Chamber of Commerce and Industry said its Business Confidence Index (BCI) for January showed an increase of only 1.0 index point to 89.3, from 88.3 in December.
This was “the slowest start to the BCI over the last 18 years since the 89.2 in January 1997”.
The chamber said the electricity supply problems had been a contributing factor to the dip and continued pessimism about future prospects for 2015.
The chamber said it was “gravely concerned about the parlous situation in which Eskom found itself”.
“The potential impacts that load shedding will have on business, business confidence and consumers alike are inestimable,” said the chamber’s economist, Richard Downing. The organisation has undertaken to work with Eskom to find a workable solutions to the electricity problem. It appealed to its members to submit proposals to alleviate the situation.
The National African Federated Chamber of Commerce and Industry expressed concern at the negative effect of power cuts on small, medium and micro-sized businesses (SMMEs). “The impact is felt not only in rands and cents but also on staff morale and productivity. The most visible of the impacts relates to transport hazards and delays,” said president Lawrence Mavundla.
Staff were arriving late at work because they had to spend longer commuting. The knock-on effect was lowering productivity and staff were being penalised for arriving late with cuts in wages.
Delayed deliveries to shops resulted in lost sales. In construction, which used power tools, the outages were also reducing productivity. Small contractors were hit hardest because they don’t have enough teams to carry on with the work when the power returns, said Mavundla.
He said because most SMMEs were to be found in the retail industry, they were bearing the brunt of the power cuts. “Spaza shops and a host of other retailers in this sector battle to keep afloat. A few of those have already had to make arrangements to buy generators to keep business going. The reality is that very few of them have the money to buy generators,” said Mavundla.
He said some financiers had already resorted to giving entrepreneurs up to R300 000 more on their loans to buy generators to avoid the interruptions brought about by the power cuts, and enable them to repay their loans on time.
The Sunday Independent