Nersa tariff unfair to Eskom, says Gigaba

LIMITING Eskom’s electricity tariff hike to 8 percent could have far-reaching implications, Public Enterprises Minister Malusi Gigaba said yesterday.

“While the National Energy Regulator of SA’s (Nersa) decision… is welcomed, the implications of the lower tariffs and revenue approved on Eskom’s operations and overall business sustainability are currently being investigated,” he said in Johannesburg.

“This decision is surely going to have far-reaching implications. It is clear the Nersa decision changes the game significantly.”

The regulator’s decision was fair to consumers, but not to Eskom, he said.

On February 28, Nersa announced it had granted Eskom an 8 percent hike each year for the next five years in its third multi-year price determination (MYPD3).

The parastatal had applied for a 16 percent increase.

The previous multi-price determination, MYPD2, ended last month.

Gigaba warned the electricity system could be fragile during winter. “Ordinarily, winter is characterised by high electricity demand. However, this winter is unique in that it is the first time that Eskom has planned to execute long-duration maintenance,” he said.

Gigaba said there was a greater need to save electricity during the daily peak period, between 5pm and 9pm.

“Just to put this in context, within this peak time South Africa’s electricity demand increases by more than 3 000 megawatts, which is larger than all the SADC countries combined,” he said.

“Therefore a significant behavioural change is needed from everyone in the country.”

Eskom CEO Brian Dames said the planned maintenance for winter would be for 2 000MW. “This is work we cannot defer for this winter.”

Consumers had to help Eskom prevent rolling blackouts. However, this could happen if a large-scale system shortage, or blackout, was imminent.

“We will not put the country at risk of a blackout…” Dames said. “If it came to it, we will dump the load to protect the country.”

Dames asked South Africans to “beat the peak” by switching off non-essential appliances. He said the system was tight after the failure of a transmission line from Mozambique, the unplanned outage of Koeberg unit one and poor coal quality. – Sapa