Eskom’s plan to cut power to the Lekwa local municipality, in Mpumalanga, will interrupt poultry producer Astral’s feed and poultry operations in Standerton with “catastrophic” results, the company has warned.
Astral has received notification that Eskom plans to start interruptions of its bulk electricity supply to the Lekwa municipality on January 23 as a result of outstanding payments to Eskom.
The North Gauteng High Court last week dismissed an application by AfriForum to prevent Eskom from cutting power to more than seven municipalities that owe the utility about R10.2-billion.
Interruptions in power supply to these municipalities will initially be for a few hours a day, but supply may be cut entirely should the municipalities not settle their debts to Eskom.
Finance Minister Pravin Gordhan has also said the National Treasury would act against municipalities that have failed to settle their debt to Eskom, which could take the form of withholding national grants to nonpaying municipalities.
Astral CEO Chris Schutte said the company regarded the notification of the power interruptions and potential disconnection of electricity supply to Astral’s largest feed milling and poultry processing operations, as a “catastrophe”.
“A major part of Astral’s operations is the livestock business, thus any form of power cut has a severe impact on the continuous supply chain of the integrated business, with dire consequences. It must be pointed out that poultry farming requires feed, water and ventilation to be available to the birds at all times,” he said.
Further, Schutte pointed out that its poultry processing plant, which consumes large amounts of electricity, requires continuous supply to run the operation as it operates on a continuous cycle with electricity required to operate machinery and refrigeration.
“The implications of the ongoing power cuts cannot be mitigated and will directly lead to bird welfare issues, business interruption costs and the loss of finished product in the cold chain. The magnitude of this decision has far-reaching impacts on the community, livestock and food security at a national level,” he added.
Astral noted that, if permanent power cuts were implemented, it would be unable to feed 11.5-million chickens a day.
Given the size of Astral’s Goldi processing plant and the Meadow Feeds mill in the town, as well as the fact the majority of Astral’s broiler farms are located in the Standerton region, it employs some 4 115 people in Standerton. Permanent power cuts would, therefore, put these jobs in jeopardy and adversely impact the local community.
Effectively, such a decision would also result in the “unprecedented large-scale euthanasia of the birds”.
Astral pointed out that it is the largest client of the Lekwa local municipality and relies on uninterrupted supply of both electricity and water to its operations.
“To date, Astral is a fully paid-up client with the municipality and legal action against the parties responsible for placing Astral in this calamitous position will be taken,” the company said.
“We acknowledge that Eskom has the right to receive payment for the supply of electricity, but we have paid for the delivery of essential services from the local municipality and are appalled that we find ourselves in this untenable situation,” Schutte noted.