ESKOM Approaches Court Seeking Permission To Increase Tariff To Get R69 Billion From Consumers

South Africa power utility, ESKOM has revealed plans to increase tariffs, a development that will see the power utility getting an additional R69 billion in revenue.

The review of tariffs is however dependent upon the High Court ac­cepting Eskom’s ar­gu­ments about the need for a much nar­rower ap­pli­ca­tion of the tar­iff method­ol­ogy.

Tariffs are set to in­crease by only 8.1% in April and 5.22% a year later but if Eskom’s application is suc­cess­ful, power tar­iff in­creases for this year and next year will have to be set at 16% to make up the short­fall.

Meanwhile, South Africa’s National Energy Regulator (Nersa) said it tested the rea­son­able­ness of Eskom’s al­low­able re­turn on as­sets as well as the tar­iffs and found that Eskom’s re­turn was too high and that the tar­iffs would be un­af­ford­able if the ad­just­ment was not made.

How­ever, Chaskalson em­pha­sised that this method­ol­ogy was sub­ject to the Elec­tric­ity Reg­u­la­tion Act which de­termines that Nersa must en­able an ef­fec­tive li­cence holder (Eskom) to re­cover the full costs of its li­cence ac­tiv­i­ties and a rea­son­able profit mar­gin or re­turn from tar­iffs.

Eskom has been struggling to contain load-shedding which resulted in its chairperson Jabu Mabuza resigning from his post.

More: Press Reader

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