Research shows the relationship between an electricity generation surplus in South Africa and economic growth. Eskom’s power cuts are killing South Africa’s economy.
We analysed the data using a technique that examines long-run relationships among the variables over a selected time period.
In 1997, Eskom requested additional generation capacity to be able to cover the anticipated increases in demand. But capacity did not increase at the expected rate. As a result, Eskom did not meet electricity consumption from 2002 to 2008, and onward. This may be through higher tax revenue, consumers’ ability to afford electricity, a better financial position for the national utility, and better credit rankings which attract investment in the energy sector.
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