South Africa's government denied on Tuesday that it was facing a national energy crisis and refuted reports that recent power outages will harm investment and cut economic growth. "There is not a national energy crisis, there is a tight reserve margin which we are addressing," Reuters quoted Public Enterprises Minister Alec Erwin as saying. The country's main tourist city Cape Town has suffered weeks of debilitating blackouts following problems at nearby nuclear plant Koeberg, causing traffic chaos and forcing businesses to close doors. Industrial hub Johannesburg has also experienced intermittent power cuts. The business community has estimated the blackouts have cost the economy hundreds of millions of rands and could jeopardize the government's goal of lifting annual growth to at least 6 percent by 2010. The economy expanded by 4.9 percent in 2005 -- its highest level in more than two decades -- but higher growth is needed to cut widespread poverty and high unemployment of over 26 percent. Analysts say the outages highlight the strain on the national grid as strong economic growth pushes peak demand to the current 37,000 MW capacity, prompting a scramble for new energy sources. Erwin told parliament's energy and public enterprises committees government's plans to meet future demand would help accelerate economic growth and would be positive for investment.
