Eskom COO Jan Oberholzer confirmed on Monday that Eskom will be in court next week, to fight a decision handed down by the National Energy Regulator of South Africa (Nersa).
The power utility wants to raise their electricity tarrifs by more than double the suggested rate.
Electricity prices may rise by 16% if Eskom’s application succeeds next week
“Our application for a tariff increase doesn’t relate to our inefficiencies,”said Oberholzer
“We cannot take public money for that, and certainly not R1.8 billion. We’re reviewing all supply contracts as we speak. The same goes for procurement. We do want to raise tariffs by 16%, and yes, it will pose a significant challenge to the economy. I agree.”
Eskom secured a 9.41% tariff increase for the 2019/20 financial year, and that came off the back of a 4.5% increase in 2018, meaning that consumers saw bills shoot up by almost 14% in 2019.
Nersa granted Eskom permission to put their tariffs up by a further 8% in 2020. However, Eskom wants the regulatory body to grant them a whopping 16% hike for this financial year.
Eskom also wants prices to go up even further in 2021.
In total, they were looking to secure a 45% increase over three years. Nersa instead decided to grant them just 22.3%, sparking the utility’s decision to take legal action.
Energy expert Ted Blom explained to The South African, that Eskom is arguing that Nersa short-changed it by at least R100 billion and is asking the court to order the claw back of at least R69 billion.
“If this first application succeeds, it could result in tariffs increasing by 16% in 2020, instead of the 8.1% as things currently stand.”