You are currently viewing our desktop site, do you want to download our app instead?
Moneyweb Android App Moneyweb iOS App Moneyweb Mobile Web App

NEW SENS search and JSE share prices

More about the app

Eskom allowed to recoup extra R6.04bn via power tariffs

After court rulings last year had set aside several of its earlier decisions.
Image: Moneyweb

South African power utility Eskom can recoup an additional R6.04 billion ($400 million) from customers via tariffs, the energy regulator said on Thursday, after a court set aside several of its earlier decisions.

State-owned Eskom is mired in a financial crisis and struggles to power Africa’s most industrialised economy because of regular faults at its creaking coal-fired power stations.

It argues that one of the major reasons for its financial woes is that regulator Nersa has consistently awarded it lower tariff increases than it has applied for. The regulator says it tries to strike a balance between Eskom’s interests and those of power consumers.

But in two rulings last year, the High Court set aside a series of Nersa’s decisions, calling some of them “procedurally unfair” and “irrational”.

Eskom made a supplementary revenue application to Nersa for the 2018/19 financial year, and Nersa had to review decisions it took on a clawback mechanism for the years 2014/15, 2015/16 and 2016/17.

The regulator said at a news conference that if Eskom were to recoup the whole R6.04 billion during 2021/22, it would result in an estimated tariff increase of 10.95%, factoring in earlier clawback decisions it had taken.

But it said it had not yet decided over what time period Eskom could recoup the additional revenue.

Eskom said it would check whether Nersa’s latest decisions were in accordance with the High Court rulings.

According to regulations, the company is allowed to recover “prudently and efficiently incurred” costs of electricity generation.

But when it is not allowed to recover these via tariffs, “Eskom is required to depend on more and more debt as well as further equity support from government to continue to provide the electricity service,” it added in a statement.

COMMENTS   2

Sort by:
  • Oldest first
  • Newest first
  • Top voted

You must be signed in to comment.

SIGN IN SIGN UP

Economics 101 says that you either reduce costs or increase prices, if you wish to minimize losses or maximise profits.
Surely its easier to reduce costs, by reducing the bloated staff compliment!? It was estimated by the World Bank (?) that they are 40% overstaffed for the amount of electricity they generate!? This, based on benchmarking other world-wide providers!? AND it was reported there are OVER 800 Managers that earn in excess of R2 mill p.a.!!???
Or maybe should also claw back the billions that the Gupta companies fleeced from them, PLUS the millions that Anoj Singh and Molefe stole?

The judiciary is as delusional as its anc “parent”.

The major reason for ESKOM’s woes has nothing to do with lower tariffs awarded by NERSA!!

Their “woes” are a direct result of theft, corruption, terrible management and overstaffing.

The only irrational thing here is that the judiciary makes it blatantly obvious that it has been captured by the anc thugs.

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Podcasts

INSIDER SUBSCRIPTIONS APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING PORTFOLIO TOOL CPD HUB

Follow us:

Search Articles: Advanced Search
Click a Company: