Civil action group, Outa says that Eskom’s application to energy regulator Nersa for a 32% price hike in 2023 will end up being closer to 38% once backlogs and court-ordered increases are taken into account.<\/p>\n
This hike, it said, would be a slap in the face of consumers and businesses who continue to suffer under load shedding, which hit stage 6 for the second time this year over the weekend, with warnings of ‘unprecedented outages’ still to come.<\/p>\n
“As the country buckles under stage 6 load shedding, Eskom is coming back to citizens of South Africa to ask for more money. It is outrageous that people are being asked to pay when services are not delivered,” Outa said.<\/p>\n
“Businesses, public services, and households are being significantly disrupted by the now-routine load shedding. Eskom seems to assume that electricity consumers are a captive audience from which it can demand money while failing to supply a service.”<\/p>\n
The group said that Nersa should grant a maximum increase to Eskom at the levels of the consumer price index (CPI).<\/p>\n
“If the economy is to recover from Covid, electricity needs to be kept to an affordable level in order to be an economic enabler,” it said. “Eskom\u2019s business interests cannot be allowed to jeopardise economic recovery, and it is in Eskom\u2019s own interest to grow the economy in order to grow electricity sales.”<\/p>\n
Eskom applied for total allowable revenue of R334.676 billion for 2023\/24. This includes R317.696 billion to be raised from standard tariff customers – i.e. everyone except the big customers with negotiated price agreements.<\/p>\n
The price is calculated from the allowable revenue and the predicted energy sales. Nersa said Eskom\u2019s application, plus three additional amounts since it was filed, could result in a price of 202.29c per kilowatt hour – an increase of 38.10% on the current price.<\/p>\n
Outa said one of the more significant changes in\u00a0 Eskom’s latest application is an increase in the fixed monthly charge.<\/p>\n
The group said that it opposes this on the basis that\u00a0 Eskom\u2019s energy availability is low – so a fixed charge is effectively billing households and other customers where the power utility is not providing any services at all.<\/p>\n
“This contradicts the principle of fairness,” Outa said.<\/p>\n
“Given that Eskom\u2019s aspiration is only 72% availability, Outa proposes that the fixed portion of any Eskom proposed tariff should be reduced to a maximum of 72%, and allowed revenue adjusted accordingly.”<\/p>\n
Outa said that South Africans can simply not afford more electricity price hikes.<\/p>\n
The last increase granted to the national power utility was 9.61% for the year 2022. However, Eskom applied for a 20.5% increase.<\/p>\n
Nersa has been trying to shift its methodologies in how it determines what Eskom can include in its tariff applications, but these have not been finalised. The regulator has been met with legal challenges from Eskom over the methodologies.<\/p>\n
Eskom, meanwhile, is looking to completely overhaul its tariff structure<\/a><\/strong> to be more reflective of costs and keep pace with the changing energy landscape. Until these matters are settled, however, both Nersa and Eskom are using the old systems.<\/p>\n
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