Previous electricity price hikes questioned

By Drum Digital
31 January 2013

The success of Eskom's previous Multi-Year Price Determinations (MYPD) was questioned on the second day of National Energy Regulator of SA (Nersa) hearings in Midrand on Thursday.

The Nersa panel should ask why, if the first two MYPD's had failed to reach their objectives, the third one would be any different, said Landless People's Movement representative Moshe Thebola.

"What made those two fail, and what makes you think this one won't fail?" he asked.

The Nersa panel, chaired by Thembani Bukula, is gathering views on Eskom's request for a 16 percent increase in electricity prices each year for the next five years (known as MYPD3).

The proposal will more than double the price of electricity in five years, taking it from 61 cents a kilowatt hour in 2012/13, to 128 cents a kWh in 2017/18.

Thebola said a price hike would most affect those people already struggling to make ends meet.

"MYPD3 is a way for the poor to pay for the Kusile plant," he said, in reference to Eskom's second most advanced coal-fired power plant, based in Mpumalanga.

Criticising Nersa for holding the hearings in Midrand, Thebola said: "A public hearing is meant for the public.... You should have gone to the people."

He said it was the people expected to pay for electricity who did not understand anything about tariffs and Eskom's policies.

He advised that Eskom relook at its MYPD3 proposal.

"I'm not saying we don't want to pay, but 16 percent is too much.

"This issue will truly provoke people and it will lead them to look for other options [to get electricity]," he said.

Asked about electricity theft, another speaker, Jacob Kganedi, of the Soweto Electricity Crisis Committee, denied that people there stole electricity.

He said they encountered "boastful" Eskom employees when they went to its offices to enquire about electricity cut-offs.

Kganedi said the committee was against the building of nuclear plants, and that the only beneficiaries would be educated foreign engineers with experience in running the plants

On Monday, Eskom finance director Paul O'Flaherty said it needed the increase to, among other things, maintain revenue and cover operating costs.

He said that if Eskom merely minimised operating costs, as had been suggested, the servicing of machinery would be neglected and there would have to be massive staff reductions.

Protests were scheduled outside the hearing venue on Thursday, but no protesters had arrived by 9am. Around 100 people demonstrated there on Wednesday.

-by Sapa

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