Cape Town - The Democratic Alliance (DA) on Wednesday disclosed the contents of a 291-page Eskom dossier, which the party says provides proof that Eskom has been charging vastly discounted electricity rates to companies that provide little or no benefit to South Africa's economy.

The documents show that BHP Billiton, directly and through its subsidiaries, takes up 9.3% of all electricity generated by Eskom - making it the single biggest user of electricity in South Africa. However, the DA says, BHP Billiton only contributes an estimated 0.1% of gross domestic product.

This is because the imported alumina smelted at the Mozal, Hillside and Bayside smelters is exported directly after it has been processed.

"The document was leaked from high level officials in Eskom to the DA and we made use of its information yesterday to question the acting CEO in the portfolio committee on public enterprises," said Pieter van Dalen, the party's deputy spokesperson on public enterprises.

"The chairperson of the portfolio committee tried to tell us not to use the report, but we are today releasing it in full, because we believe its contents are of manifest importance to the South African public."

The DA will be sending a copy of the report to the chairperson of the public enterprises portfolio committee, with a request that Eskom be called before the committee to explain the report and the facts contained within it.

The document reveals that Motraco, a Mozambican electricity distribution company, has been paying 12c per kilowatt-hour for electricity - which is far below cost. This contract was signed in 1997. This contract was signed at a time when there were the first signs that the power network was under pressure.

BHP Billiton's total payment of electricity halved in 2009/10 from what they paid in 2008/09 - which means that, conceivably, the electricity price charged to BHP declined as the rest of South Africa had to pay more.

Despite the fact that Motraco is merely a distribution agent to the actual electricity users, its debt to Eskom has increased to R100m at June 2009 - a bad debt for which Eskom did not make a provision, the DA said.

Motraco is the fifth largest electricity user in South Africa, taking 3.7% of all electricity generated in the country, and Motraco supplies 95% of its electricity to Mozal aluminium smelter in Mozambique.

Mozal in turn is a subsidiary of BHP Billiton. The second largest buyer of electricity is BHP Billiton for their Hillside and Bayside smelters in Richards Bay, which consume 5.6% of the total electricity in South Africa.

In other words, BHP Billiton, directly and through its subsidiaries, takes up 9.3% of all electricity generated by Eskom - making it the single biggest user of electricity in South Africa.

However, BHP Billiton only contributes an estimated 0.1% of gross domestic product. This is because the imported alumina smelted at the Mozal, Hillside and Bayside smelters is exported directly after it has been processed. In other words, there is no down-stream beneficiation, and yet they get below-cost electricity without making any significant economic contribution, the DA said.

- I-Net Bridge