No condonation for Eskom's application

The National Energy Regulator (Nersa) has decided that no condonation will be granted of Eskom’s request to deviate from meeting certain requirements of the Multi-Year Price Determination (MYPD).

“NERSA announced today that at its meeting held on 27 July 2017, the Energy Regulator decided that no condonation will be granted of Eskom’s request to deviate from meeting certain requirements of the Multi-Year Price Determination (MYPD) Methodology and the Minimum Information Requirements for Tariff Application (MIRTA), with the exception of the Valuation of Regulatory Asset Base (RAB) and Information on Deferred Debits and Credits,” it said on Friday.

In March 2017, the energy regulator received an application from Eskom, requesting condonation of Eskom’s request to deviate from meeting certain requirements of the MYPD Methodology and MIRTA for its one-year (2018/19) revenue application.

The power utility requested exemption from providing information as required by the MYPD. This included the RAB, Primary Energy (disaggregated coal volumes, coal handling and water costs), and Research and Development (conducting consultation).

Eskom also requested exemption from providing MIRTA information including segmented cash flow statements, split of sales revenues between regulated and non-regulated industries, projected ten-year sales forecast, disaggregated line items such as RAB, coal purchases and burn, environmental levies and deferred debits and credits.

“The condonation regarding the Valuation of RAB was granted in respect of Eskom’s one-year (2018/19) revenue application. However, the energy regulator has instructed Eskom to revalue its regulatory asset base in time for its next MYPD application.”

Nersa further added that condonation regarding information on Deferred Debits and Credits [balance in the Regulatory Clearing Account (RCA)] was granted since there is no decision yet on the RCA balance.

“The energy regulator has given Eskom thirty calendar days from the date of the decision (27 July 2017) to comply with the MYPD Methodology and the MIRTA requirements where condonation has not been granted,” it said.

In February, the regulator allowed Eskom to raise tariffs by 2.2% in the 2017/18 financial year.

Nersa’s mandate is to regulate the electricity, piped-gas and petroleum pipelines industries in terms of the Electricity Regulation Act. - SAnews.gov.za