Eskom seeks 19.9% electricity tariff increase – report

Eskom has confirmed that the board approved a draft revenue application for national energy regulator Nersa’s approval, after a leaked document showed it wants clients to pay 19.9% more for electricity from April 1 2018.

78a10395ea8d4ebeb8aa062816627e0f - Eskom seeks 19.9% electricity tariff increase – report
“The previous multi-year decision made by Nersa for the period 1 April 2013 to 31 March 2018 comes to an end on 31 March 2018,” Eskom chief financial officer Anoj Singh said in a statement on Monday.“Therefore, there is a need for Eskom to make the next application. Nersa has approved that Eskom can make a revenue application for a single financial year – the 2018/19 year.”

The statement follows a report in Moneyweb, which revealed details of a confidential document Eskom sent to the South African Local Government Association (Salga) and the National Treasury for their input.

The document also revealed that Eskom wants municipalities to pay 27.3% more for bulk electricity purchases from July 1 2018.

“The draft application is for total revenue of R218.7bn, an increase of 6.6% from the current year. The price impact is however much bigger because of the lower sales volumes,” Moneyweb explained.

The application follows Eskom’s last application, which saw the tariff increase by 2.2% in April 1 2017. Municipal customers will experience an average 0.3% increase with effect from July 1 2017, Eskom explained on Monday.

Eskom said that in order to meet the relevant legislative and regulatory requirements, the Eskom board had approved a draft revenue application for consultation with Salga and Treasury, which was submitted to the two organisations during April 2017.

“The Municipal Finance Management Act (MFMA) requires Eskom to consult with these entities before submitting its final revenue application to Nersa,” Eskom explained.

“They are allowed 40 days to provide comments. Eskom has received their responses.

“The responses from Salga and National Treasury are being considered. Eskom envisages that it would submit the final revenue application to Nersa during June 2017.”

Jun 05 2017