South Africa’s struggling state power firm, Eskom suspended electricity cuts on Friday with claims of the power system remaining vulnerable, after five days of outages which weakened the rand and affected businesses adversely across the country.
Eskom has been struggling with power station breakdowns and diesel shortages and supplies over 90 percent of the power in Africa’s most industrialised economy.
President Cyril Ramaphosa, who faces a parliamentary election in May, has pledged to reform the utility by splitting it up and providing financial support. Privatisation has however been ruled out.
The rand was on course for a loss of more than 3 percent against the dollar this week, largely due to Eskom’s woes, which risk derailing a sluggish economic recovery.
“Due to further improvement in generation performance and the notable strides made in replenishing water and diesel reserves, Eskom is not likely to implement load-shedding on Friday,” Eskom said in a statement, using a local term for power cuts.
Eskom started the power cuts on Sunday and intensified them to 4,000 megawatts (MW) of cuts on Monday in the worst outages South Africa has witnessed since 2014. The power cuts had been reduced to 2,000 MW by Thursday.
The power crisis has resulted in traffic gridlock across major cities as traffic lights stop working and frustration for ordinary South Africans builds up.
Businesses like miner Harmony Gold are exploring strategies to reduce their dependence on Eskom.
The government has promised more details about how it will support Eskom’s balance sheet on Feb. 20, when the finance minister will deliver a budget speech in parliament. One of Eskom’s major issues is its unsustainable debt mountain of around 419 billion rand ($30 billion).
($1 = 14.1358 rand) ($1 = 14.1358 rand)