South Africa launches five-year plan to boost power output

12 March 2007 – South Africa has launched an R97bn ($13.3bn) plan to expand electricity production and is soliciting bids for new plant construction projects from groups including Siemens, Alstom and Hitachi.

Chastened by unprecedented power cuts in recent months, the government has launched the five-year plan to boost power output, and recently sent its public enterprises minister, to London to woo the three potential suppliers.

South Africa is trying to make amends for underinvestment in power and urgently needs to build turbines, boilers and cooling systems.

At the end of white rule in 1994, Eskom, a state-owned group with a near monopoly on power generation, had a huge excess of capacity and envisaged exporting electricity across southern Africa. However, Eskom and the government failed to anticipate a surge in domestic demand stemming partly from a successful electrification programme in communities neglected under apartheid.

Alec Erwin, the aforementioned public enterprises minister said: “Everybody’s got shortages of capacity, all over the world there have been increased order books. Now you’ve got to move fast if you want to get into the queue.”

A South African delegation has also traveled to China to assess how much spare industrial capacity it has and Mr Erwin predicted the country would supply some equipment for power plants.