Consumers to be crippled by another electricity price hike
NIGEL/HEIDELBERG - From April 1, consumers of electricity will be paying even more.
This follows the National Energy Regulator (NERSA’s) approval of a 9.4% electricity hike for 2016/17 on March 1. Eskom submitted an application to NERSA in November last year to recover R22.8bn, which the utility said it used to avert load shedding.
“The decision comes after extensive consultation with government, unions, small and intensive users, who engaged in public hearings in six provinces,” NERSA’s chairperson Jacob Modise said during the announcement.
NERSA made the decision after conducting a due regulatory process, which included publishing Eskom’s RCA application and inviting written comments from stakeholders. Public hearings were conducted in six of South Africa’s provinces between January 18 and February 5 to afford interested and affected stakeholders the opportunity to present their views, facts and evidence.
Modise explained the challenge has been and still is regulating the energy industry in a manner that balances the interests of energy producers on the one hand and consumers on the other.
NERSA evaluated the RCA balance for the first year (2013/14 period) of the MYPD3 amounting to R22.8 billion.
Energy expert Chris Yelland said NERSA allowed only half of what Eskom claimed for, due to reduced sales, i.e Eskom only received R6.2 billion of the R11.7 billion it had claimed for due to reduced sales.
“NERSA also only allowed a small part of what Eskom claimed for diesel such as R1.3 billion compared with the R8 billion Eskom claimed for diesel,” he explained.
Researcher at non-profit organisation groundWork, David Hallowes said the recent price hike by Eskom “will take people in South Africa from poverty to destitution”. He added that the country would essentially be racking up future social and economic costs related to the increase.
