Ramaphosa asking Eskom to halt increase ‘totally out of order’

Has President Cyril Ramaphosa lost his mind asking Eskom not to implement the increase approved by the Energy Regulator of South Africa (Nersa)? Or was he simply trying to score political points at an ANC gathering to get people to cheer for him?

Delivering his closing address at the ANC’s Free State conference in Mangaung, he said that he asked Eskom not to implement the power tariff increase of 18.65%.

“I have personally said to Eskom: ‘Eskom, it will be an injury to our people if we implement this 18% now when we are going through load shedding. Put it in suspense for a while’. And so the Eskom board is going to discuss that,” he said.

Prof. Jannie Rossouw, visiting professor at the Wits business School, says the president’s comment was completely senseless.

“What was he thinking? It was totally out of order and he should be called to order.”

Why does he not just close down Nersa then if he wants to subvert the process, Rossouw said.

“The increase went though a whole process and everybody could make submissions. You cannot run the country like this. Where does it leave the Eskom management and Nersa?”

ALSO READ: Ramaphosa told Eskom to suspend tariff increase

Eskom has to increase its prices to survive and Rossouw says this is one time that he feels sorry for Eskom’s management and board.

“Besides, Nersa is a statutory organisation and the president cannot interfere in its processes.”

That is not what he said before

This comment from the president comes after he said on 12 January, when Nersa announced the latest increase, that he could not interfere in a statutory process, while his spokesperson, Vincent Magwenya, said Ramaphosa’s hands “were tied” when it came to asking South Africans to pay even more for the scarce commodity.

Nersa is a regulatory authority established as a juristic person in terms of Section 3 of the National Energy Regulator Act with the mandate to regulate the electricity, piped-gas and petroleum pipeline industries in terms of the Electricity Regulation Act, Gas Act and Petroleum Pipelines Act.

ALSO READ: Two more years of load shedding proves Ramaphosa, Mantashe ‘blatantly lied’ to SA

The authority must adhere to sound principles and approaches to deliver on its mandate and achieve its objectives. Nersa adopted internationally accepted regulatory principles to underpin its regulatory approach.

One of these principles is transparency, as independence from political influence is desirable to ensure long-term stability of regulatory practices. Avoidance of regulatory capture by some customer groups is also necessary for successful regulation, Nersa says on its website.

Nersa conducted due regulatory process

In its decision on Eskom’s revenue application for the 2023/24 and 2024/25 financial years, Nersa said it made its decisions after conducting the due regulatory process, which included publishing Eskom’s revenue application and inviting written comments from stakeholders.

Nersa also conducted public hearings to solicit comments from interested and affected stakeholders and received approximately 2 000 written comments from stakeholders, who raised concerns about affordability. 

“It is important to note that Eskom’s revenue application for the 2023/24 and 2024/25 financial years was considered against various challenges that are affecting the South African economy. Accordingly, the Energy Regulator’s decision provides a balance between the sustainability of Eskom and the economic well-being of the consumers and the economy,” Nersa said.

The Nersa spokesperson referred our request for comment to Eskom.

There has been no reply from Eskom yet.