Eskom demands 53% hike
2008-03-18 21:56
Special Report
Eskom is set to seek a 34% hike in electricity tariffs, back from the 88% rise it had been considering due to the global economic slowdown, a newspaper says.
Cape Town - Eskom wants to raise its tariffs by more than 50%, the National Electricity Regulator of SA (Nersa) announced on Tuesday.
If granted, the increase will replace the 14.2% hike Eskom was allowed by Nersa in December last year.
That increase is scheduled to come into effect from April 1.
Nersa said: "Eskom has applied for a revision of the price for 2008/'09 from 14.2% to 53% increase (sic) or a 60% nominal increase."
It said Eskom wanted the revision because of what the utility said were its higher primary energy costs, and "accelerated demand side management" costs.
"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."
Nto Rikhotso of Eskom's media desk confirmed earlier that the new application would be lodged on Tuesday afternoon, but that she could not reveal the increase sought.
She said Nersa would open up a public-participation process once the request was lodged.
"It's their prerogative to communicate what we have submitted to them," she said.
R10m performance bonuses
In allowing a 14.2% hike last year, Nersa rejected Eskom's bid for 18.7%.
Eskom said at the time it needed the increase to maintain effective operations following a steep increase in coal cost and the need to finance capital expenditure.
Its managers are scheduled to receive performance bonuses of shares valued at R10m at the end of this month.
The hike - whether 14.2% or 53% - comes in the wake of a 2c a kiloWatt hour electricity levy announced last month by Finance Minister Trevor Manuel, and amid a new round of nationwide power cuts.
Reacting earlier to media reports that the hike sought was 24%, trade union Solidarity said South Africans could not afford the increase.
It urged Nersa to reject the request.
More cheerful news from Eskom on Tuesday afternoon was that South Africans would probably not be left in the dark at the Easter weekend.
Load shedding to continue
It said in a statement that two of the nine generating units that had been out of action on "unscheduled maintenance" came back earlier in the day, and two more were expected to come on line on Tuesday evening.
"However, load shedding will continue until after evening peak (21:00) as the wet weather continues," it said.
"The cold and wet weather has increased the demand for electricity and adversely affects coal handling at the power stations."
Eskom said it was load shedding up to 2 500mW, and the risk of cuts would remain until Thursday.
"We don't expect any load shedding during the long weekend as demand patterns are historically lower during holidays," said Erica Johnson, Eskom's chief officer for networks.
Earlier on Tuesday, before any units were restored, Eskom spokesperson Andrew Etzinger said the power situation was "extremely serious".
He warned that in the unlikely, but possible, event of more generating-unit failures, power to mining companies would have to be cut.
Rikhotso said that mines were operating on rationed power, and the long-term plan was that this would be "ramped up" in stages.
An announcement on Monday that Gold Fields had been allocated additional power for use at its Kloof and Driefontein gold mines formed part of this process.
"It's going to be done for all of them," she said.
Possible class action
In January, power shortages forced gold and platinum mines to shut down for five days.
Solidarity announced on Tuesday that its leadership had resolved at an "emergency" meeting to prepare for a possible class action on behalf of mineworkers "should Eskom persist with plans to reduce electricity supplies to mines".
It said it would send a letter to Eskom warning that workers who lost their jobs due to negligence on the part of Eskom or government would be entitled to claim damages.
"Reduced electricity supplies to mines will almost certainly result in job losses," it said.
"Power provision at 90% of normal consumption (the current level to most mines) can cost as many as 20 000 jobs."
Solidarity also would ask President Thabo Mbeki to appoint an independent team to support him in seeking a solution to the electricity crisis.
- SAPA