tackling the energy crisis

2008 has probably been the worst year for South African businesses and people for what concerns electricity supply. 15 outages per month on average have threaten the Country's economic development by hitting its businesses.

Security and living conditions have worsened due to the frequent black outs. And the situation is set to worsen in the next three to five years, due to the time needed to fully implement new power plants and power stations.

The energy crisis comes from long time ago. Since the 90's, South Africa's GDP has been growing at an average 4% a year. Heavy industry have grown even faster, making South Africa's economy one of the most energy intensive on Earth. A huge plan to give universal access to electricity throughout South Africa, which implementation started in the early 90's and which completion is planned by 2015, has also increased the demand.

Outcome: electricity supply cannot keep pace with new demand.
The effects of the energy crisis are a serious threat to South Africa's path of growth:

- Eskom definition on energy supply: "emergency of force majeure"
- Creation of the "load-shedding system": programmed outages in defined areas of the country to let other areas to have power
- 15 outages (planned or un-planned) per month on average in 2008
- Generation reserves at less than 10%

In order to put an end to the present situation and to give the Country the tools to comply with its future growth objectives and needs, Eskom has planned to invest ZAR 343 billion in the next 5 years.
Such an investment plan will have to be sustained by increased incomes, given that the down-rating of Eskom's bonds doesn't allow it to raise funds on the market.
Eskom will need to reduce demand by pricing its electricity correctly

Eskom sells by far the cheapest electricity on Earth. Eskom charges 3.5 US cents per kWh for electricity to big industries. Its nearest rival is Canada, selling at double that price (6.18 c/kWh). Australia, the most similar Country as per energy mix and consumption, sells at 7.11 c/kWh.

Energy mix in South Africa: 88% coal plants; 8% diesel; 3% nuclear; 1% other sources (renewables)

Since January 2004, coal price (deflated by CPI) has increased by 93%

Since January 2004, diesel price (deflated by CPI) has increased by 190%

Most businesses, more so those in close contact with customers, cannot allow their services to be un-usable due to outages and black outs. Green Age Energy solutions are effective alternatives for those businesses and private/public purchasers, by giving them either a back up or a stand alone solution that gives them independency from the grid.