Electricity prices are set for an above-inflation increase from April next year to fund power utility Eskom’s expansion programme, News24 reported on Tuesday.
This was revealed by Eskom MD of resources and strategy Steve Lennon at a Metal Events conference at Sun City.
Lennon would not say whether Eskom would seek a price increase above the top end of the South African Reserve Bank’s inflation target at 6%.
Delegates at the conference said Eskom could seek a tariff rise of between 1% and 2% above consumer price inflation less mortgage costs (CPIX), currently just above 4%.
The National Energy Regulator (NER) is currently going through a public participation process to determine the electricity-price increases that will be effective for the three-year period starting in April.
The result of the process is likely to be known by February.
The NER has said that it would not consider inflation targeting, but rather the level of return needed by Eskom.
Lennon said Eskom is aiming to increase its electricity capacity by 4 000 megawatts by 2011 to meet South Africa’s growing electricity demand. — Sapa