News and Information

Three-Year Power Shock for Jo'burg
August 3, 2004
Business Day (Johannesburg)

August 3, 2004
Posted to the web August 3, 2004

Khulu Phasiwe, Public Policy Correspondent

SA's economic powerhouse faces R2bn electricity grid upkeep bill

THE spate of power outages hitting most parts of Johannesburg is liable to recur over the next three years as the city's council power utility, City Power, grapples with poor distribution networks and archaic equipment.

Johannesburg, which contributes about 15% of SA's gross domestic product, has been hit by frequent power cuts this winter as the 70-year-old network struggles to cope with increased demand costing organised business millions of rand .

City Power CEO Mogwailane Mohlala said the state of infrastructure in the city was dilapidated and that it would take about three years to overhaul the entire power supply system.

About R2bn has been allocated to tackle the network's problems in the next five years.

The lack of regular maintenance and investment in new infrastructure, coupled with increasing demand and illegal connections, have led to the current power outages in the city.

Mohlala said internal audits conducted on the city's electricity network had found that more than 70% of the infrastructure was between 20 and 40 years old, with 7% of it older than 40 years.

The audit also found out that the networks in central and southern regions were in the worst condition with almost 80% of the overhead network requiring replacement.

"The central and southern regions have some of the oldest equipment (more than 70 years old) and are running at maximum capacity," the audit said.

Upgrades were not possible on equipment which had been maintained beyond its lifespan.

Independent think-tank BusinessMap Foundation said that a loss of skilled personnel and the slow process of training new technicians to replace those who had left had also contributed to the deterioration of the network.

Peggy Drodskie, director of policy at the South African Chamber of Commerce, said although the effect of power outages had an "enormous impact" on the economy, it would be almost impossible to quantify what such power failures cost businesses in the city.

This was because power failures were not widespread and occurred for brief periods.

But despite all these hurdles, Mohlala said the situation had not yet reached crisis proportions.

"We are not in crisis situation yet, but we need to move swiftly to make sure that the situation is turned around," said Mohlala.

He said R460m had been allocated this year for infrastructure maintenance and refurbishment "in the problem areas".

These include d the suburbs of North Riding in Randburg, and Weltevredenpark in Roodepoort, which had received R60m and R50m respectively to deal with the growing demand for power.

More than R500m was spend in the past two years to upgrade power networks in Alexandra, Lenasia, Randburg and Midrand.

New substations would also be build in certain areas to supplement the existing capacity.

City Power said its immediate focus would be on improving its response time to power failures, removing illegal connections, eliminating faults on consumers' installations, and improving communications with customers.

Mohlala said the company was also working with equipment manufacturers like Siemens, Alstom and ABB to install new cables.

"I am confident that the situation will be turned around," said Mohlala.


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