Eskom Welcomes Electricity Price Increase

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People living in South Africa have to endure at least eight hours a day without electricity under Stage 6 blackouts. The price they will pay for electricity will increase once again in the coming months.

 


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The National Energy Regulator of South Africa (NERSA) has announced an electricity price increase of 18.65% which will take effect from 1 April 2023, and a further 12.74% increase on 1 April 2024. This is a total electricity price increase of 33.7% over the next 2 years.

NERSA said its decision was made after conducting the due regulatory process, which included publishing Eskom’s revenue application and inviting written comments from stakeholders.

“Accordingly, the Energy Regulator’s decision provides a balance between the sustainability of Eskom and the economic well-being of the consumers and the economy,” explained NERSA.

Eskom CFO Calib Cassim says they welcome NERSA’s decision. They believe it will positively contribute to the power utility from both a financial and sustainability point of view.

Cassim said, “The revenue determination of R319 billion and R352 billion for the financial years 2024/5 will allow a further migration towards a price level that reflects the efficient cost of producing electricity.”

Energy Analyst Chirs Yelland says the price increase will come as a great shock to consumers. This is compounded by the fact that citizens are enduring around eight hours of loadshedding daily.

Yelland added that NERSA didn't have much of a choice when dicing on the tariff increases. This as a percentage of the increases are court ordered and failure to grant the tariff increases will result in the energy regulator being in contempt of court.

Earlier this week, Eskom announced that loadshedding will be escalated to Stage 6 indefinitely. This leaves citizens in the dark and without electricity for approximately one-third of every day. Financial experts believe this costs the economy more than R4 billion each day it continues.

 

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