Zim, SA telcos hit hard by worsening energy crisis

Econet COO Kezito Makuni

TELECOMMUNICATIONS companies in southern Africa have been hit hard by the worsening energy crisis, which has seen daily national power grid electricity outages of up to 16 hours.

The impact of the energy crisis has been especially felt by the telecommunications sectors in Zimbabwe and South Africa, where load-shedding has disrupted service, degrading customer experience and pushed up costs as operators resort to more expensive power alternatives.

MTN group chief executive officer Ralph Mupita recently warned that South Africa risked becoming “a failed State” if the government did not address the power crisis to “secure the resilience of critical national infrastructure such as telecommunications”.

Mupita made the remarks in his company’s results released in March, following power outages that have ravaged Africa’s most developed economy and cost MTN South Africa R695 million (US$40 million) in 2022 alone.

This year, MTN said it had set aside R1,5 billion (over US$82 million) to keep its network running during load-shedding, as well as to protect network equipment and back-up power from loss and theft.

At the same time, South Africa’s major mobile operator Vodacom this week revealed that more than a third of its 9 550 towers, at any given time, are not getting power from power utility Eskom or the municipalities.

As a result, Vodacom said it had spent R4 billion (over US$200 million) on equipment, alternative energy, infrastructure and security as a risk-mitigating measure, to ensure its customers remain connected to the cellular network amid South Africa’s debilitating power crisis.

However, despite these mitigatory efforts, consumers have been left frustrated with dropped calls, as well as low-quality and interrupted service, as persistent power outages have hampered operators’ ability to provide consistent and reliable service.

In Zimbabwe, Econet Wireless, the industry’s market leader, spent much of last week battling network challenges caused by power outages that knocked out service delivery platforms at its national operations centre in Harare.

The company has invested in thousands of diesel generators, deployed at over 80% of its base station sites across the country, to mitigate the effects of load-shedding and to enhance network resilience.

Econet has also invested millions of dollars in renewable energy; becoming the first African operator to partner with Tesla, through its (Econet’s) sister company Distributed Power Africa, to install long-life lithium batteries at hundreds of its sites.

But early this week, Econet was forced to issue a statement, apologising to its customers for the network challenges it experienced over five days.

“We sincerely regret the challenges that our customers experienced over the past week, which were precipitated by power outages at our national operations centre in Harare,” the company’s chief operating officer Kezito Makuni said in the statement.

“The power outages, which unfortunately and uncharacteristically occurred twice — last Tuesday afternoon (May 9, 2023) and later in the week on Friday evening (May 12, 2023) — triggered multiple failures on our voice, SMS, EcoCash, mobile data, VAS (third-party value-added services) and on our recharge platforms, resulting in customers failing to access these services.”

Meanwhile, in South Africa, Telkom, the country’s third largest mobile network operator, recently said its profitability was negatively impacted by accelerated load-shedding in the country.

“While our mobile sites are partially backed up through battery power, access network availability is materially reduced during load-shedding stages 4 and beyond. This impacted revenue and increased roaming costs.

“However, our core and aggregation network had network availability of 99,99% during load-shedding as it has resilient back-up power, which consequently increased spend on diesel fuel to ensure network availability, thereby also increasing our operating costs,” the company said in a trading update.

Telkom group chief executive Serame Taukobong said the group’s earnings before interest, taxes, depreciation, and amortisation declined by 13,5% as a result.

“Load-shedding resulted in a y-o-y [year-on-year] increase of more than R150 million additional costs for the (last) quarter,” he said.

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