User Group Requests More Rigorous Assessment of Eskom Costs Application

South Africa’s Energy Intensive User Group (EIUG) has asked the National Energy Regulator of South Africa (Nersa) to be more rigorous in its assessment of some of the cost factors for Eskom’s electricity price increase application for the five year period from 2013 to 2018.

This request came after Eskom requested a month extension from Nersa for the submission of their application, which was due on August 31. To date it has been estimated that Eskom would be looking at annual increases of between 14.6% and 19%. They said that these increases would be necessary to cover operating costs and move ahead with its five-year capital investment programme.

The EIUG is made up of 31 members who consume approximately 44% of all electricity in South Africa. Chairperson Mike Rossouw said that Nersa should take into account factors such as affordability and cost reflectivity, and more transparency on costs and tariffs are needed. He also questioned whether Eskom should be earning the returns being sought considering that its investment programme is largely being funded by the South African consumer.

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