Power price complaints pour in

Johannesburg - Complaints about Eskom's approved electricity price hike continued to build on Thursday with the Democratic Alliance calling for significant energy sector reform.

DA shadow minister of energy Sejamothopo Motau lashed out at the National Energy Regulator of SA (Nersa) saying it promoted an uncompetitive and inefficient energy sector.

"The DA has stated repeatedly that a tariff hike of this nature will have vastly detrimental consequences for South Africa's poorest citizens."

Earlier on Thursday Nersa approved a 31.3% hike in prices, just under the 34% Eskom had asked for.

"We are deeply concerned that government is sitting idly by while the fundamental problems within Eskom, and the energy sector more broadly, are not adequately addressed."

He said Eskom's financial problems were not in dispute but the hike was cause for concern when Eskom management received bonuses of over R50m over the past four years.

"The solution to our energy sector woes is not an endless sequence of ad hoc tariff rises, but real root and branch reform of the energy sector.

"In light of this we believe that Eskom's monopoly, as sole producer and distributor of power, should be revisited urgently," he said.

Trade union UASA said the increase would be "devastating" for consumers.

UASA spokesperson Andre Venter said it was a blow to consumers and industries already reeling under the pressure of economic "meltdown".

"Consumers are losing hope, they simply won't be able to carry the extra burden. Industries struggling to keep head above water will be hit hard and I suspect many businesses will find it hard, if not impossible, to recover from this."

Meanwhile, local government said there was a need to reconsider free basic electricity subsidies.

The SA Local Government Association (Salga) said it was "delighted" that Nersa had taken cognisance of its submissions that applications must be submitted on time.

This was in response to Nersa chairperson Collin Matjila's comment that he hoped "ad hoc" submissions would be a thing of the past.

However, Salga said the increase meant more households would be unable to afford energy - given the current economic climate - and this move would see more households falling into the indigency net.

"It also increases the cost of supplying free basic electricity to indigent households and this will have a negative impact on municipal financial viability."

To mitigate the negative impact, Salga appealed to Treasury to increase the subsidy for free basic electricity allocated to municipalities.

"The subsidy increment will assist municipalities to remain financially viable as they grapple with the crippling debt situation," said the association.

- Sapa