Economy weakens as Eskom stage 6 load shedding hits South Africa
South African electricity public utility, Eskom announced stage 6 load shedding this past weekend. As the electricity supply commission continues to lose generating units at its power station, it struggles with high debt and frequent breakdowns leading to load shedding.
Eskom said in a statement that there are emergency plans in progress to minimise the current power cutouts.
“They will undertake further emergency procurement processes to secure any further available generating capacity,” reads the statement.
“This energy will provide further mitigation in the event that various assumptions in the production plan do not realise. It is hoped that these initiatives will further assist in minimising load shedding,” said Eskom.
Eskom said it plans to use R16.8 billion of diesel in its next financial year, which will kick start in April 2023.
Eskom requested R5 billion from the National Energy Regulator of South Africa (NERSA) in January.
The request done in January 2022 and April 2023 equates to a 235% increase – more than triple. Eskom will be burning R1.4 billion of diesel a month on average.
According to Moneyweb, regulator NERSA will have little room to deviate from Eskom’s numbers and limit the increase substantially.
The reduction of hours worked in manufacturing and other activities due to load shedding, stocks increased on Tuesday ahead of the expected Fed rate hike, resulted in declines in gold miners preventing meaningful gains in the market.
According to Reuters, the government’s benchmark 2030 bond ZAR2030 = got weaker in the afternoon trade.
At 15:30 GMT, the ZAR = D3 traded at 17.7100 against the US Dollar, which decreased up to 0,25% from its previous period.
On Wednesday, 21 September 2022, the Rand was trading at R17.70/$, R17.64€ and R20.12/£. The foreign currencies continue to increase, with the South African rand continuing to weaken by the minute.