JOURNAL: South Africa's Electricity Shortage

“Because of this situation, economic growth just stops. In that way, the problem solves itself.” Andrew Kenny, an engineering consultant to the NYTimes.

"If you want to see the future - just take a look at what is happening in South Africa at the moment." Paul, a SA resident, in a letter to me last weekend.

Chronic electricity shortages in South Africa provide an excellent example for why a resilient community approach to development is necessary.

Rolling blackouts ("load shedding") have made life a miserable hell for individuals and businesses alike. Under-investment, bad management, poor planning, difficult weather, and shoddy maintenance have combined to create a power crisis that will take at least four years to return to stability (which will damage economic growth, foreign direct investment, and social stability). It has also become a regional crisis, since power exports have been halted to regional trading partners. According to an e-mail from Paul in South Africa, co-dependent networks are starting to breakdown and there has been a run on alternatives sources of energy:

...the rest of the infrastructure is now showing cracks. One of the provinces told the government that they would have to initiate severe water restrictions if the situation does not improve because all the reservoirs are filled with electric pumps. And there has been a massive run on generators and UPS systems by both private individuals and businesses. Thanks to that the demand for fuel has shot through the roof. Same with LPG and natural gas products.

This may result in domestic energy hoarding/competition though selective disruption of connectivity (in a very similar fashion to what we saw in Iraq).

Comments

[Duncan Kinder]

The flip side of what John is reporting in South Africa would be Naples, Italy, where garbage removal has collapsed.

http://news.google.com/news?q=naples+garbage&ie=UTF-8&oe=utf-8&rls=org.mozilla:en-US:official&client=firefox-a&um=1&tab=wn&scoring=n

[John Robb]

More examples.

In China:
http://www.nytimes.com/2008/02/01/world/asia/01china.html?_r=1&ex=1359522000&en=c8051b084e424ba0&ei=5088&partner=rssnyt&emc=rss&oref=slogin

Acute electricity shortages across a swath of central and southern China after winter blizzards disrupted coal deliveries have exposed the fragility of transport networks in the world’s fastest growing major economy.

In Canada's PEI:

http://smartpei.typepad.com/robert_patersons_weblog/2008/01/emergency---the.html

[John Robb]

Also, big disruption due to cuts in Internet service in SE and Southern Asia:

http://www.businessweek.com/ap/financialnews/D8UGRIK00.htm

[Nic]

The problems in South Africa are due to bad planning. During apartheid, the whites got most of the electricity.

Over the last 15 years the government has extended electricity provision to many black townships.

But they haven't invested in enough extra generation to cope with the increase in demand.

There is now a power station building programme, but that will take a few years.

[Duncan Kinder]

One consequence of South Africa's energy crunch:

"LONDON (Reuters) - Platinum surged 3 percent to hit a record high for the 12th successive day on Friday, with acute power problems in top producer South Africa encouraging investors and consumers to buy up the metal."

http://uk.reuters.com/article/goldMktRpt/idUKL1521358520080215

South Africa is a major supplier of platinum and palladium, both of which - among other things - are vital ingredients for hydrogen fuel cells, a possible petroleum substitute.
See, eg:
http://www.southafrica.info/doing_business/economy/infrastructure/energy-fuelcell.htm

The other major supplier of platinum and palladium is Russia.