Market News

11/ 12/ 2019 - South Africa Power Crisis - Severe Blackouts Shut Down Mines
South Africa is facing severe electricity crisis, causing power cuts and mine closures. President Cyril Ramaphosa has had to cut short his official visit to Egypt and come home to deal with the problem.

South Africa's state-owned energy company Eskom has been struggling to keep the lights on in the country. For the past six days, Eskom has been implementing "load-shedding," whereby power is cut for anything from two to four hours to businesses and households across the country in a bid to relieve pressure on the national grid.
On Monday, the energy firm said it was cutting up to 6,000 megawatts (MW) of power from the national grid after heavy rain and flooding triggered failures at its Medupi coal-fired plant. The problem is not new, as the company has been forced to enforce such power outages intermittently over the past decade.
On Tuesday, South African President Cyril Ramaphosa had to cut short his official visit to Egypt and head back home to deal with the power crisis.
"The ongoing load shedding is devastating," Ramaphosa said in a statement earlier on Tuesday. "The energy challenges in this country will not be resolved overnight." Presidential spokesperson Khusela Diko said Ramaphosa would meet with Eskom executives on Wednesday to be briefed on plans to resolve the crisis.
Loss-making Eskom generates over 90% of the nation's electricity.
Aggravating economic woes
The electricity problems have dealt a blow to the nation's already slowing economy and transportation, among other things. The mining sector, a key part of the nation's economy, has been hit hard, with companies shutting down mines across the country.
Harmony Gold, Impala Platinum and Sibanye-Stillwater all said they had been forced to cut production since Monday because of power shortages.
"There are very few underground mines that operated overnight and will be operating normally today," said a spokesman for the Minerals Council industry body. The mining industry contributed 351 billion rand ($24 billion, €21.65 billion) to the South African economy in 2018, the Minerals Council says, equating to about 7% of gross domestic product (GDP).
John Steenhuisen, leader of the main opposition Democratic Alliance, led a picket outside Eskom headquarters in Johannesburg on Tuesday, saying the "rolling blackouts" threaten to "throw the country's economy over a precipice."
Source: DW