2013-02-22 14:17:17 - Fast Market Research recommends "South Africa Power Report Q1 2013" from Business Monitor International, now available
BMI View: BMI sees the South African economy continuing its uneven recovery over the medium term, with real GDP growth forecast expected to rebound to a tepid 3.3% in 2013. Although the supply side is still lagging behind, we see space for a moderate increase in consumption. Relatively positive demographic and economic fundamentals, alongside some big-ticket projects that are under construction or in the pipeline, support a cautiously optimistic outlook in the medium to long term. That said, a key downside risk stems from industrial unrest in the mining sector.
As predicted over previous quarters, a combination of self-reinforcing domestic and global headwinds hindered the potential of the South African power market in 2012, confirmed by the latest monthly electricity indicators
reported by Stats SA, which highlighted a contraction in the total volume of electricity available for distribution. Despite this backdrop of bleak growth, we remain of the view that positive demographic and economic fundamentals (including substantial reliance on and development of energy-intensive industries), together with some big projects under construction or in the pipeline, provide support for a relatively optimistic outlook in the medium to long term. New generating capacity is necessary to meet growing demand, as illustrated by the continued shortages, as well as by news that Eskom's margin between available capacity stood at a mere 1% in September 2012.
Full Report Details at
- www.fastmr.com/prod/536611_south_africa_power_report_q1_2013.asp ..
Going into 2013, we have adopted a marginally more positive outlook, with consumption expected to rebound to a tepid 2.37%. That said, we highlight that a number of downside risks remain pertinent:
* The temperature in the political environment was running high in the run-up to the ANC elections in December 2012. The so-called 'Marikana Massacre' is weighing heavily on investor sentiment. Furthermore, the incident and the subsequent handling thereof has undoubtedly dented support for Zuma, fuelling policy uncertainty.
* Inflationary risks, together with growing warnings from business, labour and civil society groups that further above-inflation power price increases will negatively affect a number of sectors, particularly mining and manufacturing, are curtailing the scope for a much-needed increase in power tariffs. This point is evidenced by the fact that the average yearly tariff increase of 16% being sought by power utility Eskom under the third multiyear price determination period (MYPD3) could be reduced to 10.8% and remain cost-reflective.
Cumbersome bureaucracy presents an additional potential stumbling block for many multibillion dollar power projects that are in the pipeline and in need of external financing.
Report Table of Contents:
BMI Industry View
- South Africa Snapshot
- Table: Country Snapshot: Economic and Demographic Data
- Table: Country Snapshot: Power Sector
- South Africa Forecast Scenario
- Electricity Generation and Power Generating Capacity
- Table: South Africa Total Electricity Generation Data And Forecasts
- Table: South Africa Total Electricity Generation Long-Term Forecasts
- Table: South Africa Electricity Generating Capacity Data And Forecasts
- Table: South Africa Electricity Generating Capacity Long-Term Forecasts
- Electricity Consumption
- Table: South Africa Total Electricity Consumption Data And Forecasts
- Table: South Africa Total Electricity Consumption Long-Term Forecasts
- Transmission & Distribution, Imports & Exports
- Table: South Africa Electric Power Transmission And Distribution Losses Data And Forecasts
- Table: South Africa Electric Power Transmission And Distribution Losses Long-Term Forecasts
- Table: South Africa Trade Data And Forecasts
- Table: South Africa Trade Long-Term Forecasts
Industry Risk Reward Ratings
- MEA Power Risk/Reward Ratings
- Table: MENA Power Risk/Reward Ratings (Scores Out Of 100)
- Table: SSA Power Risk/Reward Ratings (Scores Out Of 100)
- South Africa Power Risk/Reward Ratings
- Key Policies And Market Structure
- Regulation and Competition
- Sustainable Energy Policies
- South Africa Power Projects Database
- Table: South Africa Power Projects Database
- Regional Overview
- MEA Industry Overview
- Glossary of Terms
- Table: Glossary of Terms
- Industry Forecasts
- Power Industry - Data Methodology
- Generation and Consumption Data
- Electricity Generating Capacity Data
- Power Risk/Reward Ratings Methodology
- Table: Power Risk/Reward Indicators
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