Wednesday, March 19, 2008

Electricity tariff hike: 24%, 53%, 60% or 67%?

Eskom has applied to NERSA for an increase in tariffs.  Two facts emerge so far: (i) The suggested tariff hike is far into double digits and (ii) it has confused a lot of reporters.

Cape Argus reported a 24% hike. Cape Times and News24 a 53% hike, Business Day a 60% hike. Engineering News mentions both 53% (headline) and 60% (article).  Business Report mentions a 67% hike. 

A NERSA media release indicated that 53% is correct (or a 60% nominal increase): 
The National Energy Regulator of South Africa (NERSA) announced today that it received an application from Eskom for a revision of the 14, 2% price increase decision for 2008/9. Eskom has applied for a revision of the price for 2008/9 from 14, 2% to 53% increase or a 60% nominal increase.  


Eskom put forward the following reasons for the revision request: 

􏰀 Increased primary energy costs, and  

􏰀 Accelerated Demand Side Management (DSM costs)  


On 20 December 2007, the Energy Regulator granted Eskom an average price increase of  14,2% to be applicable as of 1 April 2008. 


In the light of the current electricity supply shortage and load shedding in the country, the Energy Regulator will give urgent attention to Eskom’s application and make its decision after following due process.  

All eyes are on NERSA this week.

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