"It's definitely a severe problem, some companies could go out of business, businesses that rely on electricity to survive," University of Cape Town electrical engineering professor Trevor Gaunt told Reuters.

Last week technical problems at Koeberg, the continent's only nuclear-fired facility, exposed holes in the system and subjected Cape Town to eight days of rolling blackouts.

Roads in parts of the city, the country's tourism hub, were gridlocked, shops shut their doors and harvested fruits lay rotting in stiffling heat, costing the region hundreds of millions of rands.

While the power was up on Monday, South Africa's second biggest city may now face months of power cuts while technicians work to bring Koeberg back to full power ahead of the start of the southern hemisphere winter, analysts say.

The blackouts are not unique to Cape Town, with industrial and financial hub Johannesburg having been hit by intermittent outages for the past two years.

The government has approved a 20-year plan to meet future energy needs and is now scrambling to meet demand as economic growth accelerates beyond five percent - its highest level in more than two decades.

Gaunt said electricity parastatal Eskom had known the country was heading for trouble as the load on the grid rose to critical levels, but said it was not too late to avert collapse.

"The load was growing and nothing was done about it despite the future being quite clear to all of the (government) advisers. (But) it's not too late ... in two to three years things should be okay," he said.

"NO CRISIS"

The Department of Minerals and Energy, which oversees South Africa's electricity grid, is confident that Eskom's investment plans and other private sector inputs will meet future demand.

The utility has proposed pouring 93 billion rand ($15.15 billion) into new infrastructure or upgrading existing power stations and lines over the next five years.

Government's 20-year strategy includes restarting four mothballed plants, building new gas-fired facilities and an innovative pebble bed nuclear reactor. The four coal stations are expected to add 2,700 megawatts to the grid's current 37,000 capacity by 2007 and 4,000 MW by 2011.

Another 15,000 MW will be added through various new facilities by 2024 and peaking capacity will rise an extra 3,150 MW, mostly from gas turbines.

"I don't think we are facing a crisis, we firmly believe the long term plans make it very comfortable for us to meet our needs," said department deputy director-general Nelisiwe Magubane.

The technical hitches at Koeberg did not indicate a wider crisis, she added.

One of the nuclear station's two reactors is offline because of damage from a misplaced bolt, while the other unit is due for mandatory maintenance within the next few months. The 1,800 MW plant usually meets half of the Cape Town region's power needs.

Professor Jan Reynders of the Johannesburg-based School of Electrical and Information Engineering said there had been virtually no growth in capacity over the past 10 years as Eskom sought to keep costs and prices down.

The company was tasked with connecting millions of homes that were ignored before apartheid ended in 1994, and to ensure prices remained some of the lowest in the world.

"We are now in a situation that when a piece of equipment fails we suddenly don't have excess capacity," he said.

Reynders said Eskom could solve the problems quickly with new gas turbines and a new 800 kilovolt line from the coal stations in the north helping to shore up the feed to Cape Town.

Currently, almost 90 percent of South Africa's power comes from coal, with 6 percent from Koeberg.