If a country’s electricity consumption is a reliable barometer of its economic health, SA’s economy has declined as much as 20% over the past decade.
The good news in the Statistics SA monthly report on electricity generated and available for distribution, released on Thursday, is that the economy rebounded 11% from February to March, judging from its total power bill. The bad news is that this takes its decline from an economic peak, reached in July 2007, from 20% in February to 10.7% in March.
Stats SA reports that its electricity-volume index, which was set to 100 in 2015, rebounded to 102.2 points in March from 92.1 points in February. The index reached a peak of 114.4 points in July 2007 before Eskom’s load-shedding woes set in.
Demand for power tends to be higher in midwinter and the index reached 112.9 points in July 2008 before rolling blackouts caused it to crash to a nadir of 86.8 points in February 2009.
Measured in gigawatt-hours (GWh) rather than index points, the July 2007 power peak equated to 23,801GWh. Much as Eskom likes to crow that it has resolved SA’s load-shedding
crisis, peak demand in July 2016 was 22,520GWh — 5.4% lower than 10 years ago.
A sharp decline in SA’s economy after the load-shedding crisis is borne out by other Stats SA releases. For instance, according to its manufacturing volume index, SA’s factory output reached a peak of 125.9 points in October 2007, a level manufacturers managed to sustain the next month.
The load-shedding crisis saw this index plunge to 82.7 in January 2009 and it has only limped back to 100.1 points in Stats SA’s February report.
The bleak picture of the damage done to SA’s economy by load shedding is also echoed in Stats SA’s quarterly report on the utilisation of production capacity, also released on Thursday. In the fourth quarter of 2007, before electricity became unreliable, utilisation was at 86.6%. During the height of load shedding in the third quarter of 2009, utilisation fell to 77.4%. The report shows utilisation in the first quarter of 2017 was 80.8% lower before load shedding.
The textile, clothing and footwear industry appears to be suffering most with 72.8% utilisation of production capability. The clothing sector showed the sharpest annual decline in utilisation of 2.2 percentage points.
Of the 10 types of manufacturing segments Stats SA gives utilisation figures for, only two showed improvement from the first quarter of 2016: paper and furniture producers.
Glass manufacturers had a 1.6 percentage point decline to 79.4% utilisation and car factory utilisation fell 1.2
percentage points to 82.4%.
Hidden in the figures is the damage a fourfold rise in electricity prices, along with unreliable supply, has done to SA’s economy in the past decade.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.