A question of capacity

Residents in Bedfordview were without power for three days earlier this week. An Eskom fault left consumers without power from 03h00 on Monday, 30 April until late Wednesday night. A number of shopping centres (including Eastgate Mall) were forced to shut

The media has circulated various 'scenarios' that may or may not have led to the power outage. Eskom is blaming public works, who in turn says that Eskom is simply passing the buck. It seems no one is prepared to step up to the plate and accept responsibility for the problem.

Eskom has subsequently indicated that they will conduct a full investigation into what caused the outage.

Building projects on the rocks

Eskom's inability to supply uninterrupted power is not the only problem. The weekend papers reported on a number of housing developments that have had to be shelved due to insufficient electricity infrastructure. Property developers have been unable to secure adequate supply to commence building, let alone to supply the individual residences once construction is complete.

Some months ago we watched a documentary on the difficulties facing small businesses in one of our North African neighbours. Electricity was in such short supply that business was forced to rely on two hours of power per week. They had to plan production and manufacturing around this single window of opportunity.

Thankfully, the situation is unlikely to deteriorate to such levels in South Africa. What the documentary showed is how vital a stable power network is for sustainable economic growth.

Cement stocks depleted

Electricity is not the only concern at this stage. South Africa is also facing severe shortages of raw and manufactured materials across a variety of industries. Nowhere is this shortage more exposed than in the building industry. Cement is in such short supply that massive cement producers such as PPC and Holcim have had to import the bulky commodity from China.

Another recent crisis revolved around a carbon dioxide shortage. The gas is used to manufacture fizzy drinks. Local companies bottling fizzy drinks had to limit production to crucial brands while the gas was in short supply.

South African motorists have also been frustrated from time to time by fuel shortages. It appears that the long term strategies of many local manufacturing companies simply failed to account for the massive economic growth that South Africa has experienced over the past decade. These companies will have to quickly make amends to avoid stunting the good that has been done recently.

Rail infrastructure stymies coal exports

Of greater concern than manufacturing capacity is the inability of infrastructure to carry the country's economic growth. The continued struggle with power outages has already been discussed. But more alarming is the inability of the local transport network to keep pace with demand.

The problem stems from years of neglect. First the rail infrastructure was allowed to decay - forcing many long haul freight transporters to make use of roads. And now, after years of heavier than intended use, the road network is cracking under the strain.

Coal and iron ore miners who rely on various Spoornet facilities to get their product to the export destinations have been struggling with capacity for years. Constraints on rail transportation mean that these entities continually miss their export targets.

South Africa has its work cut out if it wishes to maintain the current 5% per annum GDP growth. Expenditure on infrastructure and other capital projects will have to be intensified in the coming years.

Editor's thoughts:
We are entering what promises to be another cold winter. Do you think Eskom is ready to supply South Africas electricity needs in the next 6 months? What do you think about the proposed 18% electricity rate hike? Send your comments to gareth@fanews.co.za.