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Johannesburg - South Africa's state-owned utility Eskom said on Tuesday it needed a significant rise in tariffs to build new plants because the global financial crisis had made borrowing difficult.
The utility plans to spend R385bn over the next five years to build new power plants, and part of that money will be funded by tariffs.
"We come from a base of low tariffs and hence tariffs will have to increase significantly to begin to match what is required so that we can have this investment," Eskom chief executive Jacob Maroga told a power conference in Johannesburg.
"In the current context borrowings are difficult. Capital markets are tight, our credit rating is under threat, so access to borrowings is a challenge."
Maroga said Eskom - which charges among the world's lowest tariffs - would apply for new tariffs "very soon".
Maroga said the utility was now in consultation with the country's power regulator over the new tariffs, but was yet to make the actual application.
The utility had delayed the submission to take into account the impact the financial crisis would have on consumers, and its own ability to borrow given the state of the global markets.
A decision last year by ratings agency Moody's to cut Eskom local and foreign currency ratings also added pressure on the firm's abilities to secure funding from markets.
The regulator said it would take three to four months to process an application at any given time.
Eskom, which provides 95% of power in Africa's biggest economy, has rationed electricity since January last year, when a near collapse of the grid forced mines and smelters to shut for days, costing the economy billions of dollars.
Maroga said power supply had stabilised since early last year, and the utility has not rationed power since last April.
"We have seen no load shedding since April 2008," he said.
"January 2008 was our black January."
He said a late start on a new power generation programme, uncoordinated industry planning, a low reserve or spare capacity margin and the utility's own lack of risk management and contingency planning had led to the crisis.
"It was the most disruptive power disturbance in the history of this country," he said, noting the crisis had dented South Africa's global image and rattled investor confidence.
- Reuters