THE power blackouts in Johannesburg this winter sparked concern over City Power's capacity to provide for the electricity needs of SA's largest city.

Any kind of disruption to electricity in Johannesburg is a major concern as it has a population of 3,8-million and produces 11% of the country's wealth .

A lack of maintenance of existing equipment and investment in new infrastructure was compounded by sharp temperature drops, which led to parts of the city's power grid collapsing several times over the past few months.

Organised business in the city has felt the pain brought by the blackouts and has raised the matter with city authorities .

Johannesburg Chamber of Commerce and Industry CEO Marius de Jager says the cost of the power cuts are impossible to quantify, though he says the outages were more than just a nuisance.

While de Jager is concerned about the cuts, he is satisfied, though, that everything is being done to rectify the matter, after a presentation by City Power during the past week .

De Jager says he was assured by the power utility that the Johannesburg mayor's office had made provi sion of a reliable electricity supply its biggest priority.

City Power now has the authority to spend as much as it needs to make sure the infrastructure is up to scratch, the CEO says .

City Power was reluctant to comment yesterday because it has said it plans to make a presentation to the media later this week.

De Jager says there are already options available for businesses that need a constant supply of electricity. He says a business can get a dedicated power line to ensure supply.

An upmarket shopping mall in Rosebank has already applied for one of these lines because it experienced a surge in demand for power from eating establishments during lunch time.

But the blackouts Johannesburg has gone through highlight a deeper concern that SA is rapidly running out of adequate capacity to generate electricity.

State-owned power utility Eskom says that if it does not take any action, increasing demand will limit its ability to supply "excess peaking capacity" by 2007.

Eskom spokesman Fani Zulu says the power utility is working hard to ensure SA has an adequate supply of electricity.

Eskom is bringing mothballed power plants back into use and is looking at ways to limit demand.

Government has also put out a tender for a new power station and Eskom is looking at the probability of importing electricity from neighbouring countries.

Other options include Namibian and Mozambican gas fields supporting gas power stations.

The fear is that a lack of capacity will hamper SA's economic growth and push up the price of electricity. Cheap power is seen as a trump card for drawing foreign investment.

It costs SA $0,371 to produce 1000kW of electricity, making it the cheapest producer in the world.

There is a 29% gap between the cost of producing electricity in SA and that of its nearest low-cost producer, Canada. This gap means there is space to increase prices, Zulu says.

It is ironic that SA is looking to increase its capacity, considering it had excess capacity during the 1970 s and 1980 s.

This excess capacity meant no investment was put into creating new power stations.