The cost of Eskom is big business
Power comes from the people
The cost of the constant load shedding, which seems to hover between Stage 2 and 4 on a weekly basis, is being felt everywhere from private households to company boardrooms.
While large JSE-listed companies are more able to absorb the expense of the interruptions than individuals, it adds up even for them.
This was brought home last week when Pick n Pay released half-year results, saying it had to fork out an additional R110 million on energy costs "net of electricity savings costs" to cope with the intensive load shedding. This equates to about a quarter of the company’s pro forma profit before tax of R588 million.
And they are not the only retailer having to spend large sums to keep on trading when the lights go out. Clicks CEO Bertina Engelbrecht told delegates at the Consumer Goods Council of South Africa’s annual summit last week the group had spent R90 million on backup batteries, and that no profit can be made from that investment.
When she presented full-year results this week, Engelbrecht said the higher levels of load shedding had impacted 34 000 trading hours, up from 13 000 in the previous financial year. The group had to make use of battery packs, inverters and generators to partially offset these negative effects.
While there are welcome plans afoot to increase supply to the grid through President Cyril Ramaphosa’s energy crisis strategy, what isn’t helping is the constant breakdowns at power stations. Dark forces are at play, as swindlers steal Eskom's high-quality coal, replacing it with discard coal, while insiders have also deliberately cut cables and committed other acts of sabotage, resulting in load shedding being intensified.
Urgent action is required to beef up security both at power stations and for the transport of coal. The state has to act now. If it means deploying the army to protect the transport of coal or extra independent security personnel at premises, then it must do so.
Perhaps it is also time to look to utilise artificial intelligence and other electronic tracking measures to help secure both premises and coal transport. The government would also be sure to find support from the private sector and possible partnerships in bringing in this type of tech to strengthen security.
A R9bn yacht and the Gini
South Africa is no stranger to wealth inequality, but Capetonians look set to get a particularly glaring example of it offshore soon, with a $500 million (R9.17 billion) yacht reportedly owned by Russian oligarch Alexey Mordashov, the Nord, expected to drop anchor around November. Ultimate destination unknown.
The Nord is almost 142 metres long, more than twice the length of Castro’s yacht. It is worth half the V&A Waterfront, and twice SA’s annual naval budget (four frigates, three subs, zero yachts).
The ship is also worth more than Grindrod Shipping (R8.8 billion on the JSE and 31 ships, though it has received a $506 million buyout offer). Selling the Nord would shave a cool 2.3% off of Eskom’s debt pile, and fund two years of a Karpowership rental.
The yacht is also equal to 40 Nkandlas - or roughly 11 Zondo commissions.
The fate of the yacht is unknown, but is likely to be caught up in the unprecedented sanctions against Russia and its elites, while SA has its own problems and elite inflation and attachment issues (both in the public and private sector). But there is still something ironic in such a vessel, representing such individual power and ultimate freedom, being on the run.
Yet with SA’s gini coefficient north of 0.6 (0 is total equality, 1 complete inequality), horrific and unsustainable as that is, at the very least it's worth celebrating that we have a free and impartial justice system, for determining the fates of wine estates, yachts, and taxpayer-funded plunge pools.
Also, with all the dark secrets of government financing, as bad as it is, even when seen in the number one spot on global inequality rankings, SA likely isn’t the most unequal country on earth. Just perhaps the most unequal where good statistics are available.
Perhaps Russia is the most unequal society on earth, if all the money taken offshore by oligarchs is taken into account. Or perhaps North Korea or Turkmenistan is, if trustworthy numbers were available. Cold comfort, sure, but at least Cape Town is far warmer than Vladivostok.
Quote of the day
Chart of the day
Last week, South Africa exported 44 276 tonnes of maize.About 71% to Taiwan, and the rest to Southern Africa.This brought South Africa's total 2022/23 exports to 1,9 million tonnes out of the seasonal export forecast of 3,5 million tonnes. pic.twitter.com/COQavjtxyU— Wandile Sihlobo (@WandileSihlobo) October 23, 2022
Tweet of the day
Lies, damned lies, and statistics. I have updated this @opinion chart with fresh data.China imported a record of ~1 million b/d of Malaysian crude in Sept. That's nearly **double** the real output of Malaysia.The reality? Re-branding of Russian, Iranian and Venezuelan oil. pic.twitter.com/szI7lFCMgN— Javier Blas (@JavierBlas) October 24, 2022
Number of the day
The average wage settlement in SA collective bargaining agreements in the first half of 2022, according to Andrew Levy Employment Publications.
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