![\"Tariff](\"http:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2015\/06\/Tariff-increase-vs-inflation.png\")
<\/a><\/p>\nIn a joint written submission<\/a> to Nersa, professor Raymond Parsons from the North West University Business School, Professor Waldo Kruger from the North West Department of Economics, and professor Gavin Keeton, from Rhodes University of Economics, argued that a tariff increase would have serious economic effects.<\/p>\n “The electricity situation has become a huge liability to the economy and that needs to be changed,” the academics said.<\/p>\n They warned that electricity consumption is now already at low levels last seen a decade\u00a0 ago.<\/p>\n With a fall in electricity consumption – or users switching to other sources of energy\u00a0\u00a0 supply permanently because of cost or supply uncertainties – Eskom’s finances deteriorate further, thus ostensibly requiring further tariff increases.<\/p>\n The cumulative impact of a seemingly endless cycle of tariff increases has come to have\u00a0 negative consequences for the economy, which has slowed to less than 2% growth.<\/p>\n The paper pointed out that if Nersa grants the latest application in full, the electricity\u00a0 price will appear to have doubled since 2009, with no end apparently in sight.<\/p>\n “To continue along this path of ever rising electricity costs with no clear end in sight, combined with a severe drop in confidence among both households and business about the supply and cost of power, (it) is a recipe for additional economic setbacks,” the paper said.<\/p>\n Eskom\u2019s sums don\u2019t add up: energy expert<\/a><\/strong><\/p>\n Higher tariffs or power cuts \u2013 you choose: Eskom<\/a><\/strong><\/p>\n Electricity tariff hike will cripple SA<\/a><\/strong><\/p>\n<\/a><\/p>\n<\/a><\/p>\nMore on Eskom<\/h3>\n