Eskom is reviewing the implications of Nersa’s decision to grant it a lower than requested electricity tariff hike, Public Enterprises Minister Malusi Gigaba said on Wednesday.<\/p>\n
“We are studying it in detail, because we need to understand what will happen to Eskom’s operations through the build programme over the next five years,” he said at a Cape Town Press Club breakfast.<\/p>\n
Eskom welcomed the National Energy Regulator of SA’s ruling, because this was to the benefit of consumers, but it presented problems Eskom would need to deal with.<\/p>\n
Eskom had applied for a 16 percent increase in electricity prices in each of the next five years. This would have more than doubled the current price, taking it from 61 cents per kWh in 2012\/13, to 128 cents per kWh in 2017\/18.<\/p>\n
Nersa announced at the end of February it had opted for an eight percent increase for each of the next five years.<\/p>\n
Eskom had the right to appeal against Nersa’s decision.<\/p>\n
Gigaba said the lower tariff hike presented a problem for Eskom, as it had to decide on future power after completion of its second new coal plant Kusile, in Mpumalanga, in 2017.<\/p>\n
“What I see is that we must work such that we take decisions early and quickly; sustainable decisions, so that we don’t get the country back to the uncertainties and power supply insecurities of 2008,” he said.<\/p>\n
“When the last unit of Kusile delivers power, the next generation of power stations must already be in motion. I’m talking about the generation capacity that provides the base load.”<\/p>\n
He said government had thus made it clear that it remained resolute in pursuing nuclear options, while taking into account safety and technology issues.<\/p>\n
The country seemed very nervous about the cost of nuclear, but forgot about the cost benefits in carbon emissions, and how costs “dramatically subsided” with security and long-term sustainability.<\/p>\n
He said the nuclear programme could be one of the critical drivers of industrialisation which the country sought.<\/p>\n
“But before then, perhaps it is time that we consider taking a firm decision on coal three, in order to meet the security of supply challenges at a later stage, given that taking a decision on nuclear and the need to implement it properly and raise funds is going to take time.”<\/p>\n
Gigaba said his department was in discussions with the energy department and Eskom on whether to bring the this third coal-fired power station project forward, initially planned for after 2025.<\/p>\n
“I think we should [bring it forward], but we are discussing that with the Minister of Energy [Dipuo Peters],” he said.<\/p>\n
Gigaba was asked whether the State would continue to help bail out parastatals.<\/p>\n
“Do I anticipate further government support for Eskom and SAA? I would be lying if I said no,” he replied.<\/p>\n
Implementation of long-term strategies would require support in some form, including financial support.<\/p>\n
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