The Cost of Load-shedding in South Africa

As Eskom continues to disrupt the country with constant power outages, the true cost of load-shedding in South Africa is devastating. Businesses across multiple sectors are affected, from remote workers to restaurants, shops and offices. In the case of smaller establishments, the cost of backup power is running into thousands of Rand. Even larger businesses that are able to keep the lights on are facing difficulties as a result of load-shedding in South Africa. Many experts predict that things are not going to get any easier for the time being.  

The Economic Impact of Load-shedding

No business can afford to lose profits – whether it is a multinational corporation or a boutique retailer. Although some businesses are able to afford generators and alternate power sources, others are unable to factor in the additional costs. 

In a recent EWN interview, Nedbank economist Isaac Matshego stated that until now, mining and other industries had been performing well. Load-shedding has caused a major blow, resulting in a ripple effect. He went on to say, “Load shedding will disrupt production activity at the mines to some extent and as a result, we could see overall economic for 2021 being just below 5%.”

Moneyweb, meanwhile, published findings from a research report done by accounting firm PwC. This report states that ongoing load-shedding is expected to lead to job losses of 350 000 or more, despite previous projections of a 3.9% economic growth rate this year. The report further notes that loadshedding returning after many weeks of power has even more of an impact. 

Also mentioned in the Moneyweb article is expert insight from’s Mike Schüssler, who says that job losses in South Africa have already been as high as over a million jobs.

In addition to the financial cost, there are also other costs. Businesses require stable power to continue running operations at optimal production levels. Productivity is greatly affected by loadshedding. When schedules change, very little notice is given. This means that stage 1 load-shedding can suddenly jump to stage 4, with less than half an hour notice. Load-shedding may be suspended for a week or more, only to suddenly resume. This has a knock-on effect, making it harder for businesses to operate as normal.

To mitigate some of these risks and reduce the impact that load-shedding has on businesses, energy management plays an important role. To find out more about our services, which range from utility auditing to remote metering, contact Energy Management Solutions now.