Eskom: Moody's view won't hurt rating
Fin24 & I-Net Bridge
Johannesburg - Power utility Eskom said on Monday that a comment by ratings agency Moody's will not affect its rating.
On Monday Moody's described a drastic reduction in the tariff increase granted to Eskom recently by the National Energy Regulator of SA (Nersa) as "credit negative for Eskom".
Nersa has allowed Eskom a 16% average hike for 2012/13 instead of the 25.9% it originally granted in 2010.
Eskom said that Moody's comment did "highlight the need for electricity prices to continue moving up towards cost-reflective levels".
The utility said its financial position has improved but it needs certainty on a longer-term price path for electricity.
"This will ensure that Eskom, and the electricity industry, are financially viable and sustainable," said Eskom chief executive Brian Dames.
Dames and finance director Paul O'Flaherty visited credit rating agencies in London last week together with Deputy Public Enterprises Minister Benedict Martens to explain the reduction in the tariff increase.