The Hidden Costs

I had to publish from Leofinace PeakD tonight as unfortunately images were not loading on the new UI.

I have touched on this subject before with how the extra alternative energy costs are adding fuel to the fire of inflation. Residential you can choose to sit it out but businesses have no choice, but to come up with alternative plans.

We have seen our retail grocery chain stores burn R2 million each per day which is roughly $100K which would I presume go down to running costs and be a tax write off. Maybe not all of it is being written off as the prices have been raised to cover the extra costs, but then again something tells me the profits will be up due to the tax deductibles and the consumer will be the one paying for this.

Vodacom announced yesterday that they have spent R10 billion over the last 2 years on alternative energy due to load shedding. That is $500 million dollars spent over and above just to keep their network up. The towers that send the signals for your cell phones to operate have to stay on and this is where the costs are coming from.

Businesses have to make alternative arrangements these days and Vodacom announced they have purchased electricity from Independent Power Providers also known as IPP. They are spending/investing R60 billion and is by far the best way forward as they have nothing to show for the R10 billion already spent. This is not going to improve anytime soon and if you want to remain in business you have to be ready to invest to guarantee power in the future.

The Government announced that they are hoping to attract over R2 trillion of investment over the next 5 years. Who would be crazy enough to invest that type of money knowing the track record Africa has with corruption? They talk the talk, but rarely walk the walk and wind farms along with hydro and solar projects should have been done when load shedding first came about in 2007 ,16 years ago.

This is the chart up to 2022 and we all thought that was bad enough but in 2023 we have already surpassed the entire blackouts of 2022 and we are only in May. Stage 6 which is 10 hours per region per day is where we are now so stage 2 or 4 seems more like a luxury these days.

The costs that these businesses have already been forking out for are nothing in comparison and are only going to increase considerably. I try and put everything into perspective as to what it is costing myself to keep the lights on and the daily price has jumped significantly over the last month. Before I was forking out between $5 and $8 per day depending on the schedule as early hours you can ignore as you are sleeping as daytime is the problem. This week it is up to $15 per day as we have 10-11 hours of lost power with the schedule not being kind with 8 hours during the day and evening being lost.

Right now it is a noise you cannot describe as I can hear roughly a dozen generators close by and it is like everyone has a large truck turned on in their driveways. I used to feel bad if I turned mine on at 2 am due to being busy on Hive, but no one cares as everyone has their own hours.

We all expect this to get worse as the black out times increase to 12 hours and God forbid 14 hours per day. The talk is that stage 16 is being discussed which I don't expect to see 16 hours of blackouts, but more the industrial areas being hit harder. Up till now some have been exempt and the new schedule will have them all included. A high court ruled 2 weeks ago that Hospitals , schools and police stations have to be exempt from power cuts. There was 1 hospital generator that ran out of fuel causing chaos and fatalities which is inexcusable. This is 2023 and not the 1800's yet it feels as though this country has seriously gone back to the dark ages.

The reality is every service, food item and business will have a new hidden cost and as this escalates the cost of living will rise accordingly. The prices we pay today will seem cheap in 6 months from now as prices are rising not monthly, but every other week. This makes me seriously happy I am at least stacking in crypto as this is the only positive right now.