Eskom price-hike application 'a complete farce'

The current Eskom application for a 35% electricity tariff increase is a farce, the Democratic Alliance (DA) said on Thursday.

The tariff—brought before the National Energy Regulator of South Africa (Nersa), was in fact “null and void” as the application did not include enough renewable energy sources as required by law, the DA said in a statement.

“Any application brought before Nersa must comply with several requirements, one of them being the amount of renewable energy which Eskom will produce as part of its total electricity generation,” the DA’s shadow minister of public enterprises, Manie van Dyk, said.

He said the electricity parastatal’s application did not comply with the amount of renewable energy required, as stipulated by the Integrated Resource Plan (IRP) and as required by the Electricity Regulation Act.

“This can only mean that the Nersa hearings calling for public input are a complete farce as Nersa will now be forced to reject the 35% application on a legal basis, allowing Eskom to simply revert back to its original application of 45%, requiring another round of hearings.”

He said it was also “highly suspicious” that the IRP, stipulating the new energy requirements, was only signed into law on December 16 2009 and only published in the Government Gazette on December 31 2009.

“It creates the impression that the Department of Energy is somehow complicit in the 35% farce,” Van Dyk said.

“This chain of events is simply unacceptable and suggests that Eskom has little real interest in public debate, transparency and accountability.”

Van Dyk said if the 35% recommendation was rejected one could argue that Eskom would have effectively misled the country on energy matters directly affecting economic growth and job creation.

“Eskom needs to produce enough electricity for South Africa’s economy to function properly.

“If it cannot do that the consequences will be catastrophic.”

Van Dyk said the public was “caught between a rock and a hard place”.

“On the one hand we need to do whatever it takes to ensure that we have enough electricity, on the other hand they are being forced to carry the cost of an administration that has grossly mismanaged our electricity infrastructure.”

Against this background, however, the DA did not believe Eskom had done everything in its power to keep the proposed tariff hikes as low as possible.

“This most recent debacle is yet further evidence of their failure to properly handle this matter.”

Van Dyk said the DA would ask the ministers of energy and of public enterprises to respond publicly to these facts “as a matter of urgency”.

He added that Eskom had a penchant for “leaving South Africa in the dark”, and this could not be allowed to happen again.

‘Undesirable status of player and referee’
Meanwhile, the Congress of the People (Cope) warned on Thursday that the African National Congress’s (ANC) unscrupulous governance will continue to produce the “greedy Marogas of this world”.

Cope had noted former Eskom CEO Jacob Maroga’s outrageous and regrettable R85-million lawsuit against the financially ailing state power utility, Cope spokesperson Mlindi Nhanha said.

“The public is currently terrified by the anticipation that Eskom is going to be granted the 35% tariff hike on electricity by Nersa while the public will unfortunately have to foot the bill,” he said.

Maroga was really taking South Africans for a ride considering that the report by former Eskom chairperson, Bobby Godsell, had on record confirmed that the parastatal “perished” under Maroga’s guard, with a list of no fewer than 40 tasks left undone.

“Cope, however, believes that Maroga’s behaviour is perpetuated by the precedents set by ANC government that senior executives of state-owned entities and other public institutions can continuously loot the public purse despite non-performance.

“Our view is that Maroga’s actions are also encouraged by the ruling party’s undesirable status of player and referee with Chancellor House’s stake in Hitachi Power Africa through which the ANC benefits from Eskom.”

According to media reports, the ANC is set to earn billions of rands through tenders given by Eskom to Hitachi. The ANC’s investment arm, Chancellor House, owns 25% of Hitachi.

Nhanha said that under Maroga’s leadership, Eskom had failed to develop and present a clear plan to deliver affordable, safe and cleaner energy for the country.

“Yet he has the audacity to claim R85—million, for what?

“The Congress of the People views Maroga’s lawsuit to be fed by nothing but greed and indiscretion.

“We are very displeased by his ... attempt to milk blood out of the SOE [state-owned enterprise], well knowing that he left the power utility in a sorry financial state for which he is partly responsible.”

Cope supported United Democratic Movement leader Bantu Holomisa’s call for the energy portfolio chair to summon Eskom to appear before the committee on the Hitachi deal, he said.—Sapa

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