City rejects Eskom’s application to hike electricity price by 20,5%
13 January 2022
Yesterday, I wrote to Eskom’s CEO, Mr André de Ruyter, asking him to formally withdraw Eskom’s application to increase the price of electricity by 20,5% in the 2022/2023 financial year. Alternatively, I suggested to Mr De Ruyter that the application could be revised to bring the planned increase in line with inflation.
Capetonians simply cannot afford this increase. It is unfair, unaffordable and unjustified. Like the majority of South Africans, many Capetonians are struggling to make ends meet. The pandemic and national lockdown led to the closure of hundreds of businesses in our City and the loss of thousands of jobs. Our residents are faltering under the burden of the rising costs of energy, fuel, food, and basic consumer goods.
The consumer price index (CPI) is currently stated as 5,5%; this would have been a more reasonable tariff increase for Eskom. The price of electricity has risen by 307% over the past 13 years, far exceeding inflation. Despite paying more for power, South Africans have experienced an unreliable electricity supply — 2020 and 2021 were two of the worst load-shedding years on record.
I acknowledged to Mr De Ruyter that under his management, much has been done to improve efficiencies at Eskom, and I applauded his efforts in this regard. I also acknowledged that Eskom clearly needs to take further urgent steps to reduce its debt and improve its financial sustainability. However, passing the bill on to struggling consumers should not be the default solution.