JOHANNESBURG—Dinner party conversations in South Africa often revolve around crime. People seem compelled to share stories of how they were robbed or how they luckily escaped a robbery or attack; then the conversation usually drifts to the inadequate or non-existent response from police, the government, and the law courts. But lately the focus has shifted from crime to electricity.

It’s easy to see why: South Africa is in the grips of an energy crisis. Power cuts have become routine across the entire country. The state-owned energy firm, Eskom, which is the country’s sole legal producer and distributor of electricity, simply cannot meet demand. These cuts mean that traffic lights no longer work, resulting in gridlock across most cities. 

But delayed motorists and commuters are the least of the problems. Restaurants have had to close and are forced to throw away produce that rots in the summer heat. Supermarkets and shops cannot trade, banks have to shut down for hours on end, and travel agents cannot book flights or hotels. Tens of millions of dollars of export fruits, vegetables, meat, and fish has spoiled, ruining the livelihoods of countless farmers and fishermen and denying the country much needed foreign exchange. In hospitals, nurses have had to ventilate seriously ill patients with their bare hands, as the mechanized ventilation machines have failed.

While the power cuts have affected all parts of the economy, the mining sector has been hit hardest. In recent days, South Africa’s gold, platinum, and diamond mines had to shut down production out of fear for the miners’ safety. The national economy is built on mining: according to local economists, for every ten days that the mines are shut down the country loses 0.1 percent of GDP growth. Every day that Eskom fails to provide electricity costs the economy about $285 million.

The response from the South African government would be laughable if the problem were not so serious. Eskom refers to the power cuts euphemistically as “load shedding” (though one might just as easily call them “incompetence reminders”). Spokesmen from the power supplier have been on radio and TV appealing to companies and individuals to cut their consumption. Only a state-owned monopoly would be urging the consumers of its product to buy less of it.

Eskom, South Africa's sole legal producer and distributor of electricity, has appealed to companies and individuals to cut their consumption. Only a state-owned monopoly would be urging consumers to buy less of its product.

The minister of public enterprises, Alec Irwin, proposes rationing and price hikes to deal with the problem and has threatened to outlaw the export of high grade coal so that the government can direct the fuel to power stations. South Africa has had a particularly wet summer, and Irwin has claimed that the wet coal is, in part, a cause of the power outages. (Irwin is the same man who, several years ago, blamed a power outage at South Africa’s only nuclear power plant on saboteurs, when in fact it was caused by poor maintenance.)

Meanwhile, at a special sitting of parliament, the minister of energy and minerals, Buyelwa Sonjica, made the laughable suggestion that South Africans should “go to sleep early so that you can grow and be cleverer; boil less water; use the microwave rather than stove; take a shower rather than a shallow bath.”

The power crisis is not only a source of national embarrassment—Eskom says it won’t be able to guarantee full service until 2012—it exposes some of South Africa’s serious public policy problems. There has been little effort by the African National Congress (ANC), the governing party, or by Eskom to hold anyone accountable for the electricity shortage and its colossal costs. The fact that the ANC holds more than 70 percent of the seats in parliament means that it can disrespect the institution with impunity and advance its own agenda without regard for the smaller parties. It also maintains a tight grip on the state-owned media, which has been spinning the energy crisis and deflecting blame from the government.

In all likelihood, it was the ANC’s obsession with changing the racial makeup of companies, both state-owned and private, that led to the current problems. In practice, this meant firing white workers and hiring black ones. Transforming Eskom so that it better reflects the country’s demography is one thing, but doing so in a way that alienates the current employees and robs the organization of years of expertise was shortsighted. As we now see, it has been enormously costly to all South Africans, regardless of their skin color.

President Thabo Mbeki’s government is constantly accused by the hard-left trade unions and the South African Communist Party of being too pro-market and economically liberal. If only these charges were true. In fact, Mbeki has prevented the privatization of state-owned enterprises for far too long. If he had privatized electricity production and opened up the market so that any producer could supply power, South Africa probably would not be in its current predicament.

The energy crisis can be overcome if South Africa embraces such free-market reforms. Meantime, Mbeki should fire his incompetent ministers and sack the inept Eskom officials. But given the ANC’s track record, this may be too much to hope for.

Richard Tren runs the health advocacy group Africa Fighting Malaria.