South Africa's powerful labour union COSATU said on Wednesday it would call a national strike next month to protest job losses linked to the country's power crisis.

The union said the strike would be the culmination of a series of protests launched in South Africa's nine provinces from July 2.

The action is ... in response to the danger of retrenchments (layoffs) in the mining sector and elsewhere due to Eskom's decision of to reduce electricity supply to industry and its threat to oppose any new major construction initiatives, COSATU said.

It will begin on 2 July 2008, with provincial action, continuing throughout the month of July and culminating in a national stay away on 30 July, added the labour body, a key ally of the ruling ANC party.

South Africa has suffered electricity shortages since the start of the year as power utility Eskom [ESCJ.UL] struggles to generate enough power to meet demand.

Mining companies and other major electricity consumers have seen their power supplies rationed since the national grid came close to collapse in January, forcing big gold and platinum mines to shut down for five days.

Some mining groups have warned of job losses if mines were left without power again.

Power shortages have dented South Africa's growth, which fell to a 6-1/2-year low of 2.1 percent, quarter-on-quarter, in the first three months of 2008, and heaped pressure on President Thabo Mbeki.

The power crisis is the result of years of underspending on electricity generation capacity. State-owned Eskom, which provides 95 percent of South Africa's electricity, plans to plans to boost its current 37,761 megawatt capacity by almost 15,000 MW, spending 1.3 trillion rand ($163.5 billion) by 2025.


But to shore up its finances, Eskom asked regulators to approve a doubling electricity tariffs over two years, provoking a backlash from the ANC and its labour allies, who said it would hurt the poor and stoke inflation.

The utility has since backed off, agreeing in principle to raise tariffs gradually over five years. The National Energy Regulator of South Africa (NERSA) is due to announce a decision on the tariff structure next week.

COSATU said Eskom's proposed tariff increases would put thousands more jobs at risk as companies, already facing massive increases in the cost of fuel and interest rates, either lay off workers or were forced to close down.

We are adamant ... that workers should not be asked to pay for government's failure to invest in electricity in the late 1990s, COSATU said on Wednesday.

COSATU is demanding (that) the costs of the power-cuts are not borne by the poorest in society, that workers are not retrenched as a result of the power-cuts and that the electrification programme to poor households is not compromised. (Editing by Jon Boyle)

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