AfriForum to request reasons for Nersa’s decision to grant 9,4% tariff increase
7 March 2019
AfriForum condemns the National Energy Regulator of South Africa’s (Nersa) decision to grant a tariff hike increase of 9,4% for the 2019/2020 financial year and will request Nersa’s reasoning behind this decision. Tariff hikes such as this one is unsustainable and that Eskom’s state-guaranteed monopoly on electricity supply is extremely unhealthy for the country, its people and its economy.
Nersa also granted an amount of R3,869 billion for the Regulatory Clearing Account (RCA), after Eskom applied for R22 billion.
AfriForum opposed this tariff hike from the outset by submitting written comments to Nersa. The civil rights organisation also partook in the public participation process by presenting a submission which argued that the cost of Eskom’s alleged corrupt activities and maladministration should be excluded from the calculation of the coming year’s electricity tariff.
Dr Eugene Brink, Strategic Advisor for Community Affairs at AfriForum, says that Eskom could not prove that it deserved higher increases. “The government uses Eskom’s hegemony as leverage to keep the public and business sector hostage, which conflicts with best practices elsewhere in the world. Eskom’s dominant position – it provides 95% of the country’s electricity – also allows the organisation to continually apply for excessive tariff increases for electricity. Poor management style and the fact that officials are not held accountable for maladministration and corruption, are largely the cause of the problem at Eskom.”