Electricity prices to increase, while load shedding is here to stay

POLOKWANE – Electricity consumers in the city, like countrywide, can expect to dig even deeper in their pockets if they want to keep the lights on.

Local tariffs increased from R47,60 on July 1 2010 for the first 100 kWh slowly finding is way up to R77,65 per kWh usage (domestic users) in 2014/15, while a basic charge of R64 each was added for all domestic consumers/households.

Electricity tariffs, determined by consumption, range from users (who use 0 to 50 kWh) who pay R71 per kWh, to users (who use 600 or more kWh per household), who pay R143 per kWh in 2014/15.

Different basic charges and tariffs are set for industrial, agricultural, bulk and other users.

In October last year the National Energy Regulator of South Africa (Nersa) set the the tariff increase at 12,69 %, to be implemented in the 2015/16 financial year.

The regulator said in a press release that it would be a once-off recovery from the standard price hike of 8%, announced for the period 2013 to 2018.

Eskom initially proposed a 25% increase every year for this period, but after strong opposition from stakeholders, requested a 16% increase each year. Nersa granted an 8% increase.

Electricity tariffs in the last five years have shot up by more than 170%.

From 2008/9 to 2012/13, Eskom tariffs for bulk electricity to municipalities for instance went up by 27%, 31%, 26%, 26% and 16% respectively.

The 12,69% increase for 2015/16 was granted to recover a R7,8 billion “unbudgeted costs” of the utility.

Eskom’s chief executive officer, Tshediso Matona last week during a press briefing by the utility, however said he “would have to engage with the regulator regarding costs.”

He said Eskom’s financial reserves were low, as the usage of diesel depleted the reserves. He further said the financial problems involved more than diesel issues, but that reduced sales and an inadequate tariff for electricity did not cover Eskom’s costs.

Glen Steyn from Glen Steyn and Associates, a local development economics consulting firm, said the issues around electricity tariffs were quite complex.

On the one hand, demand was increasing. On the other, better services should be a non-negotiable.

The country cannot afford an enormous once-off tariff increase, but that gradual increases are sure to occur, as the economy cannot grow without electricity and an increase in electricity supply.

“New projects to create more jobs would demand more electricity. There has to be realistic price increases but it has to go hand in hand with better better efficiency.”

• In the meantime, provincial government spokesperson Phuti Seloba said management teams would monitor the usage of electricity to see to it that that lights, air conditioners and heaters are switched off after office hours to reduce electricity usage. Polokwane Municipality spokesperson, Matshidiso Mothapo, said the municipality installed motion sensor switches in the civic centre offices and other buildings to ensure that the lights automatically switch off if the offices are not occupied.

The municipality is currently running a campaign on energy saving tips.

In addition, all traffic lights were fitted with LED lights.

Report faulty streets light by calling (015) 290 2490.