Electricity pricing debunked

The amount paid by households for electricity in relation to what industry pays appears to spark as much debate as Eskom’s overall price application. Virtually every sphere of business and society made its voice heard through written and oral submissions during the National Energy Regulator of South Africa’s (Nersa’s) public participation process to evaluate Eskom’s price increases. At the public hearings, held in all nine provinces, debate centred on not only the price increase applied for, but also the need for an appropriate tariff structure. Questions are asked about how Eskom decides how much it should charge its customers, and whether there is justification for differentiation. There is, indeed, justification for differentiation, considering the country’s electricity pricing policy, to which Eskom adheres. Electricity tariffs are bundles of para- meters which Eskom applies to recover measured costs (such as energy consumed) and unmeasured costs (such as service costs). There are many ways to set elec- tricity prices. In Eskom’s case, tariff design is...
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Eskom faces demand whammy

Johannesburg - The projected slowdown in the growth of SA's energy demand will serve as a temporary breather to utility Eskom, easing chronic power shortages, an industry group said. But the slowdown, coupled with difficult financial markets, will also make it difficult for the utility to fully utilise that window of opportunity, said Brian Statham, chairperson of the SA National Energy Association (SANEA). "It's a vicious cycle for Eskom... and they will be in a very difficult balancing act trying to manage their way through it," Statham told Reuters in an interview. Eskom, which provides 95% of SA's power, has been rationing electricity since the national grid nearly collapsed last year, forcing mines to shut down for five days and costing Africa's biggest economy billions of dollars.  Statham expects demand growth to drop to around two percent from previous forecasts for an annual rise of four percent, owing to a slowdown in the growth of SA's economy, expected to expand three percent in...
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