The National Energy Regulator of South Africa (Nersa) on Thursday announced that Eskom will be allowed to increase electricity tariffs by 18.65%.
The new revised tariffs and prices will be effective from 1 April.
Deadline pushed
Nersa was expected to announce its decision on whether to approve or dismiss Eskom’s revenue application to hike electricity prices in November last year.
While the announcement was postponed to 23 December, Nersa’s electricity regulation subcommittee indicated that it needed more time to process Eskom’s application before it made a decision so the Pretoria High Court pushed the deadline to 12 January 2023.
Eskom had applied for a 32% tariff increase for the 2023/2024 financial year and an additional 9% in 2024/2025.
The ailing power utility was looking to recover R351 billion through the tariff hike in 2023/2024 and had planned to recover R381 billion the following financial year.
‘Best interest’
During a media briefing on Thursday, Nersa chairperson Thembani Bukula said Eskom’s revenue application was considered under several economic challenges.
In a meeting earlier before the announcement, Nersa said it was unfortunate that the regulator was caught between a rock and a hard place.
“If we don’t approve a particular number hoping that Eskom will do the correct thing then we could be deemed to be budgeting for load shedding,” Nersa regulator member Nhlanhla Gumede said.
“Whatever decision we land on, we must ne able struck a balance between what is the best interest of the overall South African economy and the public.”
Gumede highlighted that it was known that “Eskom can’t be efficient”.
“Therefore in whatever application they make for the use of diesel…. we are saying to consumers out there ‘pay for these plants that are not working, but over and above that also still pay for more diesel’. We all know that is unfair,” he continued.
Nersa previously only granted Eskom a 9.6% hike despite asking 20.5%.
