Last day of Eskom hearings

Friday, January 22, 2010

Pretoria - The public hearings into Eskom's proposed 35 percent tariff increase over the course of the next three years will wrap up in Midrand later today.

The National Energy Regulator of South Africa (Nersa) has been engaging with the public and business before making its decision over the parastatal's request.

Today's hearings are expected to include input from trade union federation Cosatu, the National Consumer Forum and the Freedom Front Plus among other submissions.

In its presentation at the hearings on Thursday, the South African Chamber of Commerce and Industry (SACCI) highlighted the need to realistically consider all inputs and operational costs.

The chamber referred to a survey it had carried out among its members which showed that respondents could only accommodate an increase of inflation plus three to five percent.

Sacci said that inflation, which in November stood at 5.8 percent year-on-year within the central bank's target, was likely to increase by about 0.3 percent putting it outside the three to six percent target range.

"It is estimated that approximately 500 000 jobs would be lost. The ripple effect would be reduced personal disposable income and therefore household consumption expenditure. SACCI estimated that the overall loss to Gross Domestic Product would be about R200 million on the most conservative basis," said the chamber.

It further proposed that the National Energy Policy be implemented with the introduction of private participation in power generation being fast tracked.

Sacci recommended to the regulator that Eskom be granted an inflation related increase for 2010/11 and that this period be used to develop a strategy that will provide the country with sustainable power supply.

Eskom acting Chief Executive Officer (CEO) Mpho Makwana yesterday urged the regulator to consider its application carefully.