MTN to invest $100m in generators as Eskom fails to keep the lights on


The South African mobile operator is battling daily power outages caused by load shedding, as well as an increase in theft and vandalism at its mobile base stations

South Africa has been battling with an energy crisis for well over a decade now, the exact causes of which are myriad – a convoluted tale of corruption, sabotage, mismanagement, and overreliance on a fading coal industry.

The national grid operator, Eskom’s, solution to demand surpassing supply has been the introduction of load shedding, or pre-planned regional blackouts, which began back in 2007 and have grown longer and more severe ever since.

Naturally, operating a telecoms network under such conditions is no easy feat. The country’s mobile operators have introduced various special measures to build additional energy resilience into their network, from upgrading their back-up batteries to installing solar panels on the base stations themselves. In 2022, MTN even began crowdsourcing generators to support their network’s power needs.

But even these measures are proving insufficient in the face of increasingly severe load shedding. In 2023, blackouts took place on a record 280 days of the year, some of which lasted up to 10 hours at a time.

Despite this, the South African government – notably gearing up for an election next month – says it is aiming to put an end to load shedding this year, with President Cyril Ramaphosa saying that “the end of load shedding is finally within sight” in a speech earlier this year.

The government has been trying to transition the country’s largely coal-based energy supply to more renewable sources for a number of years now, backed by an $8.5 billion international support package agreed during COP26 in 2022.

MTN, however, thinks the government is being too optimistic. The operator says it has already spent roughly $140 million on generators to support its mobile base stations, and will spend $101 million more by the midpoint of the year to further shore up the network.

“As we look at our business in South Africa, the key thing is to get beyond the load shedding. Our view is that load shedding will be with us for at least another three years, which is why we’ve pre-emptively invested in the resilience of our network,” MTN CEO Ralph Mupita told the Financial Times.

This additional power generation will not only help MTN provide more reliable services to customers during power cuts but could also represent a new revenue stream through the generation of excess energy.

“If load shedding improves, then we have the opportunity to actually sell some of the excess power back into the grid. It’s an opportunity that could come out of this crisis,” said Mupita.

MTN recently released its latest financial report, noting that net profit had fallen 83% year-on-year. While this was largely caused by the devaluation of the Nigerian naira wreaking havoc on MTN Nigeria’s finances, the challenging operating conditions in South Africa were also noted as a major factor.

Last year, rival operator Telkom also blamed load shedding for its profits falling over 76%.

Keep up to date with all of the latest telecoms news from around the world with Total Telecom’s daily newsletter

Also in the news:
Digi Spain sells 6m FTTH accesses to Onivia
Vodafone’s 5G standalone network now connects around half the German population
Broadband poles no problem for Brits says new study

Recent Posts