Eskom wants 45% hike for next three years

Eskom wants a 45% tariff hike every year for the next three years, according to its multi-year price determination submission document to the National Energy Regulator of SA which was handed to the media before a briefing in Johannesburg on Tuesday.

There were other options, but Eskom recommended this option be considered as it “mitigates the impact of price increases on customers and the economy and provides for a sustainable long-term solution”.

The parastatal said government had endorsed this approach which was based on the smoothing of price increases.

The second option, not recommended by Eskom, was an increase of 146% in the first year of the multi-year price determination period.

David Mahuma, head of clean energy at the ministry of energy, said on Monday that the government agreed that the tariffs needed to rise to help the utility raise funds for its expansion programme, but would leave the decision on the amounts to the energy regulator.

“We do not necessarily support the quantum [which Eskom is asking for], but the principle,” he said on the sidelines of a solar energy conference.

Mahuma dismissed media reports suggesting that the government was in favour of any particular increase.

“We leave it up to the regulator to make the decision ... but we are in agreement that we are in for above-inflationary increases,” he said.
- Reuters, Sapa