SOUTH AFRICAN POWER UTILITY GRANTED 2.2 HIKE IN ELECTRICITY TARIFFS

PRETORIA, The National Energy Regulator of South Africa (Nersa) has allowed Eskom to raise tariffs by 2.2 per cent in the 2017/18 financial year.

“The allowed revenue of 205,214 million Rand (about 15.65 billion US dollars) for the 2017/18 financial year will now result in a percentage increase of 2.2 per cent,” Nersa Chairman Jacob Modise said here Thursday.

Modise told journalists that the allowed revenue is Eskom’s full year revenue, as determined in the Multi-Year Price Determination (MYPD3) decision whereby Nersa approved an 8.0 per cent average increase per annum for a period of five years, starting from April 1, 2013 until March 31, 2018.

Modise said the reason for the lower percentage increase was because of the base adjustments made in preceding years as a result of the approved Regulatory Clearing Account (RCA) balances for Eskom.

He emphasised that the decision on Eskom’s allowable revenue was not new as it was made in February 2013 as part of the MYPD3 decision..

“The only new matter that was considered by the Energy Regulator today was the potential financial harm that may be occasioned by Nersa not being able to process new RCA applications as a result of the interventions of the Gauteng High Court,” he said.

“In this regard, Nersa has decided to allow Eskom to make a new application that will be considered in accordance with Section 4 of the Electricity Regulation Act, should they wish to, which application will be considered through a full public consultation process.”

Modise said the approved revenues of 205.214 billion Rand would be able to cover all of Eskom’s allowed costs, plus a return of 33.667 Billion Rand, in line with the MYPD3 decision.

“The decision by the Gauteng High Court has resulted in Nersa being unable to process RCA applications until its appeal has been heard and decided upon,” Modise said.

Nersa is appealing the North Gauteng High Court judgment in which the court set aside the regulator’s decision to grant Eskom a tariff increase.

Source: NAM NEWS NETWORK

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