Manufacturer wins interdict against load shedding

The company is Sonae Arauco (SA), a manufacturer of wooden panels for the construction industry. They had an agreement with the municipality that its plant near White River in Mpumalanga would not be affected by load shedding, as long as it reduced its electricity usage by 30%.

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However, the municipality started subjecting the factory to loadshedding in December 2022, without warning. Sonae Arauco argued that this was a breach of contract and that the load shedding was causing damage to its equipment and putting its workers at risk.

The court agreed with Sonae Arauco and ordered the municipality and Eskom to stop subjecting the manufacturer to loadshedding.

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The court found that the municipality had a legitimate expectation that its power supply would not be interrupted due to load shedding, and that Eskom had not proved that there were no alternatives to achieve the same goal.

The court’s decision is a victory for businesses that are affected by load shedding. It sends a message to municipalities that they cannot simply ignore their contractual obligations to businesses.

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The decision is also a setback for Eskom, which has argued that loadshedding is necessary to protect the national grid. The court’s decision suggests that Eskom may need to find other ways to manage the demand for electricity.

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Last week, South Africa’s biggest energy users opposed an application by Eskom to try and recover costs. The Energy Intensive Users Group (EIUG) believe the overruns were caused by factors that were within Eskom’s control.

Read more on that story here.