The National Energy Regulator of South Africa (NERSA) granted Eskom a 12.69 percent increase in electricity prices from the 8 percent approved in February 2013.
It announced on October 3 that it approved the implementation plan of the Regulatory Clearing Account (RCA) balance of R 7,818 million for Eskom as a once-off recovery from standard tariff customers.
Economist Vuledzani Patience Ndou said an increase in electricity hampers business and economic growth.
“Businesses end up having to cut costs to accommodate the increase which sometimes results in workers getting retrenched”, she said.
Ndou explained that the increased tariff will increase interest rates which add more pressure on the already indebted consumers as they’re already struggling with food prices and transport costs.
“Industries that use a lot of electricity, such as mining and retail will be affected the most”, she said.
Ndou’s concern is consumers struggling to make ends meet and having less money in their pockets to spend for the rest of the month.
