Eskom

The Democratic Alliance (DA) on Wednesday submitted a memorandum to the Minister of Public Enterprise, Lynne Brown, demanding immediate action to act on a plan to increase electricity tariffs. Eskom
The national electricity utility Eskom announced last month that it will raise electricity tariffs by 25.3 percent, beginning from April 1, 2015. This is despite the 12.69 percent increase for consumers, and 14.25 percent for municipalities, that has already been granted for the 2015/16 financial year by the National Energy Regulator of South Africa (NERSA).
“We are here today to tell Minister Brown and Eskom that South Africans will not tolerate electricity tariff increases, far above inflation, to fund the administrative incompetency and waste at Eskom,” DA Parliamentary Leader Mmusi Maimane said in Pretoria when delivering the memorandum.
A 25.3 percent increase will only exacerbate the burden of the electricity crisis and load shedding on citizens, he said.
The decision to increase electricity tariffs has met with strong opposition.
The Congress of South African Trade Unions (COSATU) said Eskom is imposing its crisis on consumers.
Eskom said its current financial position, as a result of historical non-cost reflective tariffs and the lag in recovery of eligible expenditure, does not afford its balance sheet the ability to pre-fund further costs that are necessitated by a constrained power system such as short term power purchases from independent power producers and municipal generators and the increased use of open cycle gas turbines.
Eskom, which provides more than 95 percent of South Africa’s electricity, has been blamed for constant power outages that have hit South Africa since November last year when a number of its coal-burning power stations collapsed due to poor maintenance.
The cash-strapped utility is forking out billions of rand to keep the lights on by turning to diesel.
The government has earmarked 23 billion rand (about 1.9 billion U.S. dollars) to bail out Eskom.
“Instead of taking prudent measures to bring the electricity crisis under control and contain costs, Eskom is simply shifting the burden onto South Africans who are already suffering from the increases in taxes and levies in the 2015/2016 budget,” Maimane said. Enditem

Source: Xinhua,

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