’It’s Unsustainable’: Outrage Over Electricity Tariffs

Anger over high electricity tariffs has boiled over onto the streets as residents have participated in several protests this week, demanding the scrapping of “unaffordable” charges.
The protests come as small towns in the province have also voiced dissatisfaction with the latest tariff hike which came into effect in July amid rising food and fuel prices.
This week residents protested outside Parliament and the Eskom offices in Bellville calling for the “exorbitant” tariffs to fall.
Heidelberg resident Alexander Panzek said in Hessequa, some people paid up to R253 fixed levies on prepaid electricity, R580 for billed and R800 for business.
These excluded consumption rates. “It is not just the electricity levies, it is other tariffs as well, which have increased by more than 120% in the past five years,” said Panzek.
He said small businesses and guest houses paid double the tariffs.
“It’s a pyramid scheme. These high electricity tariffs, variable fixed fees and levies on electricity have gone totally overboard and are now unaffordable to the majority,” added Panzek.
He said the small, medium and micro-sized enterprises which were critical contributors to economic growth, would soon not be able to create jobs as a result of the tariffs.
“It is also of extreme concern that public complaints are answered with some or other legislative excuse.
Panzek and the residents called on Western Cape Premier Alan Winde and Local Government MEC Anton Bredell and Nersa to urgently intervene.
He called on rates, tariffs and fixed levies on electricity to be halved and any recent 14% to 15% tariff increases across the board to be reversed and adjusted to the current inflation rate of 4.5%.
A Gouritsmond resident and member of the local Ambrella Ratepayers Organisation on the Garden Route, George Niewoudt believed that municipalities were putting themselves at risk of debt if they continued with the tariff hikes over the next few years.
“It’s unsustainable. Many homeowners and small businesses will not be able to afford the high levies. Already, the Hessequa municipality is regarded as having one of the highest fixed charges in the country,” said Niewoudt.
He believed that the fixed charges and levies were disproportionate and hurting the poor.
Niewoudt said the small towns, which constituted the municipality, did not have a large revenue base as the economic output was lesser than the bigger cities.
“In my town almost 80% of ratepayers are retired. Those who are employed work in hospitality related businesses such as guest-houses. Those small businesses have been hard hit by Covid-19. It took six months for the municipality to extend any relief support to those businesses,” he added.
The municipality introduced fixed charges related to property values over the past few years.
A letter sent to the Hessequa municipality following a meeting of the various organisations representing the small towns voiced concerns that their input was not taken into consideration. They also charged that the tariffs over the past five years far exceeded the inflation rate while salaries and pensions were not increasing.
“The public participation process is just a tick-box exercise,” said Niewoudt, who added that he was organising a survey to encourage other residents to speak up.
Cape Town has seen several protests recently with residents calling for the electricity tariff to fall.
Resident Natasha Selbourne said access electricity should be regarded as a basic need and not treated as a luxury only afforded by a few.
“An 80-year-old person bought electricity for R50 and only received nine units. It’s now come to a point where we have to choose between electricity and other basic necessities such as food,” said Selbourne.
Economist at the University of Stellenbosch Business School Professor Andre Roux said the cost of living for poorer households was rising at a faster speed than for others.
“To buy the same amount of food as last year they will have to buy less of something else. As it is, an estimated 13.8 million people in South Africa (or 25% of the population) are experiencing food poverty. There is a good chance that the fast-food price increases will aggravate this situation, especially in the light of the fact that the breadwinners in many households have lost their jobs in recent times because of the Covid-19 epidemic.”
Roux said the increase in fuel costs over the last few months were also starting to exert a strong influence on the cost of living.
The Pietermaritzburg Economic Justice & Dignity’s Household Affordability Index which tracks food price data showed data in July the average cost of the basket was R4 137.43. Data also showed that prices of some of the basic foods such as cooking oil, potatoes, onions, frozen chicken pieces and butternut had increased.