South Africa's power crisis poses a threat to economic growth and the government's efforts to reduce unemployment and poverty, Deputy President Phumzile Mlambo-Ngcuka said on Monday.
If this situation is not addressed, it will call into question the many goals of socio-economic development that we have committed ourselves to, Mlambo-Ngcuka told an energy summit in Johannesburg.
South Africa's state-owned power utility Eskom [ESCJ.UL] has been battling to contain an electricity crisis brought on by years of underspending in generation capacity.
Eskom has rationed power through a process called load-shedding since January, when the national grid virtually collapsed and millions were plunged into darkness.
The crisis has rattled investors, who also worry government will veer to the left after a decade of pro-business policies. There are also fears power outages could blight the 2010 soccer World Cup in South Africa.
Eskom, which produces about 95 percent of the country's electricity, said the power crisis would go on for years.
Mines, including the world's biggest platinum and key gold mines, were forced to halt output for 5 days in January due to electricity shortages and are still not receiving full power.
Minerals and Energy Minister Buyelwa Sonjica said on Monday that power supply to some mines will be maintained at 95 percent of their normal requirements.
We will maintain the status quo until we are guaranteed there is enough supply, Sonjica told Reuters on the sidelines of the energy summit.
Mlambo-Ngcuka said the country's robust economic growth was also a factor in the power shortages.
While our socio-economic progress has to be praised, our economic growth has accelerated (power) demand, she said, adding that the government should not shirk its commitment to provide affordable electricity to the poor while moving to solve the power crisis.
Economic growth in South Africa is slowing. GDP growth fell to a 6-1/2 year low of 2.1 percent quarter on quarter in the first three months of 2008.
Eskom has announced plans to boost its current 37,761 megawatt capacity by almost 15,000 MW, spending 1.3 trillion rand ($165.1 billion) by 2025. (Writing by Marius Bosch; Editing by Keith Weir)
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