Nersa set to announce Eskom hike decision

The National Energy Regulator of South Africa (Nersa) is expected to announce its decision on Eskom’s tariff application on Wednesday.

Nersa is scheduled to hold a press conference in Pretoria at noon on Wednesday at which it will make known its decision regarding the price hike.

Eskom has applied for a price increase of 35% every year for three years to help raise funds for a R385-billion power expansion programme.

Prior to the application, it had demanded a 45% hike over the next three years, but reviewed the application after strong protests from major mining companies.

Last year, Eskom increased its tariffs by 31%.

In January, Nersa held countrywide public hearings on the tariff application.

Bitter pill
Mpho Makwana, acting CEO of Eskom, told the hearing in Polokwane that South Africans should absorb the shock of the increase now.

“We know this is a bitter pill we are asking the nation to swallow, but we will all ultimately benefit,” he told the hearing.

Business Unity South Africa CEO Jerry Vilakazi told Nersa’s hearing in Gauteng that if the increase was accepted by Nersa: “We can wave goodbye to an immediate recovery for South Africa’s economy”.

The Congress of South African Trade Unions, the South African Communist Party, the South African National Civic Organisation, the Young Communist League and the Treatment Action Campaign have all alleged that Nersa had already taken a decision to grant Eskom the 35% increase and the public hearings were only held to comply with the law.

Meanwhile, the South African Chamber of Commerce and Industry (Sacci) has estimated that a 35% hike could push inflation up by about 0,3%.

“This would then put inflation outside the SA Reserve Bank’s target range of between three and six percent,” Sacci said, adding that the hike would also cost SA about 500 000 jobs. - Sapa


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