Last week Tuesday I did my morning meditation, listened to a motivational podcast, and then happily jumped into my cold shower. But I had a rude awakening when my hairdryer wouldn’t switch on – thanks to Eskom. My client could not make my first meeting and my team were all stuck in traffic.
My mindful morning had turned into a bad hair day!
I cannot help but be positively pessimistic about load shedding especially after catching up on Professor Thinus Booysen of the Department of Electrical and Electronic Engineering at the University of Stellenbosch appearance on The Money Show. The link for your convenience (https://www.702.co.za/articles/431812/what-happens-to-south-africa-if-the-eskom-grid-collapses)
The elephant is in the room and the question that most of us are too scared to ask is: Is the grid on its last legs?
For those of you who may not know me, I run an underwriting insurance agency. I cringe when contemplating the risk to businesses at this time and how our nation’s grave power crisis affects every business owner fighting to keep their people employed.
In the media, Eskom appears to be a vegetable soup cooked on a gas stove. There are so many opinions out there and it is so confusing. No one knows what is going on, and there is much finger-pointing and speculation whilst keeping proud South Africans in the dark!
The best tweet I have seen is from Victor Dlamini who said ” Eskom now produces more press releases than it does electricity”.
Eskom has indeed gone far and beyond to ensure everyone in the media that the grid is stable and there is no need for panic.
What now for businesses and how does load shedding impact the risk every company faces at the moment?
Many tips out there
There are many tips on the internet for companies to keep their businesses going, from downloading the app EskomSePush to monitoring load shedding times, buying expensive generators and surge protectors, charging your technology whilst you have power and backing up information.
Our interdependence on each other is now at stake as experts are warning that a blackout is not impossible. Whilst insurance providers can give you all the tips in the world to survive the consequences of a neglected power system, the reality is that the risks now possibly extend beyond the control of everyone in the process.
Consequences of possible prolonged power outages
These power outages are on a totally different level, but we cannot rule out the possibility of prolonged outages. For many businesses, it’s impossible to handle daily operations. Not to mention the impact on manufacturing and supply chains.
Network connections cause severe problems for fibre providers and users and in addition, it impacts our cell phone signals. All forms of communication may be affected.
Load shedding increases the number of road accidents and compromises the safety of passengers as traffic lights are out of order. Businesses must also cope with the increasing cost of employees coming late, employees not being able to work from home, and business delivery deadlines for goods and services missed.
Security becomes compromised due to backup batteries not running gate motors, access controls, and alarm systems.
Prolonged outages may affect water supply.
ATM’s will be down and shops will possibly be closed.
Your vehicle may run out of juice.
Your policy conditions
Your policy conditions under your insurance policy remain in place and this includes having a working linked alarm and surge protection and keeping your premises locked and secure.
Our insurance landscape is undoubtedly becoming more complex. For this reason, every business owner needs to go back to basics and analyse your business continuity and contingency plans as your policy may not be sufficient to provide cover for the new risks that you are exposed to.
Finally, consider what it would mean for your business if you are faced with a national blackout. A total collapse of the power system would mean that we will be without power for extended periods as opposed to our two to four-hour shedding routine. After a blackout, the reconnection of all the generators could take weeks, leaving large parts of the country without electricity for days.
Remember every detail you leave out is a gap where someone or something else will decide your fate. It is an easy question to avoid, a hard one to answer, but impossible to ignore.
Contact your insurance broker to discuss how your insurer will handle any claims directly or indirectly due to load shedding or in the event of a national blackout.
Although we got a break this past weekend from load shedding and lots of reassurance, it is responsible to remain prudent when it comes to identifying and managing the potential risks your company may be exposed to.