‘Eskom’s proposed 15% tariff hike will hurt Nelson Mandela Bay economy’

Date: Jan 18, 2019

The tariff increases of 15% per year proposed by Eskom in its MYPD 4 application, if approved, would have dire consequences for the Nelson Mandela Bay and national economy.

Speaking on behalf of the Nelson Mandela Bay Business Chamber at a Nersa public hearing held on Thursday in Port Elizabeth to evaluate Eskom’s application, Business Chamber board director, MC Botha, said the ripple effect of such high tariffs could lead to economic decline, a decrease in investment and an increase in unemployment and poverty.

Nelson Mandela Bay Business Chamber been participating in Nersa hearings for over 10 years
The Business Chamber has been actively defending the interest of businesses by lobbying against unreasonable tariff hikes at Nersa’s public hearings since 2006, and strongly objected to the latest application.

Botha said the application was unrealistic and could mean that Nelson Mandela Bay consumers would contribute R17-billion in revenue to Eskom over the next three years. This would include a total increase of about R5-billion.

He also argued that Eskom’s sales forecast during the MYPD 4 period is based on the assumption that increased prices would have no effect on electricity sales, while the Business Chamber expects Eskom’s sales to decrease by at least 3% per year, in line with a report by Deloitte.

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