South Africa’s struggling state power firm Eskom suspended electricity cuts on Friday but said the power system remained vulnerable, after five days of rolling outages which weakened the rand and hurt businesses across the country.
Eskom supplies over 90 percent of the power in Africa’s most industrialized economy but has been grappling with power station breakdowns and diesel shortages which have curbed its ability to run backup power sources.
President Cyril Ramaphosa, who faces a parliamentary election in May, has pledged to reform the utility by splitting it up and providing financial support but has ruled out privatization.
The rand was on course for a loss of more than 3 percent against the dollar this week, largely because of Eskom’s woes, which risk derailing a sluggish economic recovery.
“Due to further improvement in generation performance and the notable strides made in replenishing water and diesel reserves, Eskom is not likely to implement load-shedding on Friday,” Eskom said in a statement, using a local term for power cuts.
Eskom started the power cuts on Sunday and intensified them to 4,000 megawatts (MW) of cuts on Monday in the worst outages South Africa has seen since 2014/15. The power cuts had been reduced to 2,000 MW by Thursday.
The power crisis has caused traffic gridlock in major cities as traffic lights stop working and frustration for ordinary South Africans.
Businesses like miner Harmony Gold are exploring strategies to reduce their dependence on Eskom.
The government has promised more details about how it will support Eskom’s balance sheet on Feb. 20, when the finance minister will deliver a budget speech in parliament. One of Eskom’s major issues is its unsustainable debt mountain of around 419 billion rand ($30 billion).