• Caught in the debt trap?

    Help us help you by taking our second annual Debt survey and you could win R3 000.

  • Rich man, poor man

    Culture change from below is the only way to overcome poverty, says Leopold Scholtz.

  • Tech bubble talk

    After the tech euphoria of 2013, the fast-moving sector has hit a speed bump.

Data provided by McGregor BFA
All data is delayed
See More

Eskom wants 16% tariff increase

Oct 22 2012 10:19 Sapa

Related Articles

S&P downgrade worries Eskom

Eskom mum on steep hikes

Coal strikes could hit power supply

Coal strike worries Gigaba, Eskom

SA needs R35bn power boost - lobbyist

Eskom must be clear on prices


Johannesburg - Power utility Eskom said on Monday it has applied for a 16% annual increase in electricity rates over five years to pay for new plants and buy power from independent producers.

The state-owned utility said the increases, from April 2013 to March 2018, would include a 13% annual hike for its own needs and a 3% rise to support the introduction of independent power producers.

Eskom's Chief Executive Brian Dames said the utility would spend R337bn on capital expenditure over the next five years and would need R78bn over the same period to buy power from independent producers.

Eskom is currently building three new plants - Medupi, Kusile and Ingula - with the first power from them at least a year away.

"We have not included any new build expansion beyond Kusile in our tariff application," Dames said at a media briefing ahead of the announcement. The Kusile plant is expected to be commissioned in 2018/19.

Eskom has been struggling to raise the money it needs to build power plants fast enough to avoid a repeat of a 2008 crisis that forced mines to shut for days and cost Africa's biggest economy billions of dollars in lost output.

Energy-intensive users, including the vital mining industry, have long said that the steep increases were making some of their operations unsustainable. Unions have also protested over the impact of above-inflation hikes on everyday South Africans.

Eskom, once one of the world's lowest-cost electricity producers, has been granted annual increases of 25% in recent years.

Earlier this year President Jacob Zuma asked Eskom to seek options to limit the increases to protect economic growth and the last 25% hike was cut to 16%.

The increases could put additional pressure on consumers, already battling with the fallout of the global economic woes, and mining houses that are battling to contain labour unrest that has brought some of their operations to a standstill.

The rand and government bonds showed little immediate reaction to the news.


Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Company Snapshot

We're Talking About: Small Business

Standard Bank is looking for 12 entrepreneurs to participate in a 10-part TV series. They could win a R1m investment into their dream.

The rich will pay - Mpofu

The EFF in Gauteng will focus all its energy on improving the lives of the poor, the party's premier candidate Dali Mpofu says.


Latest elections multimedia

Watch what happened when we blindfolded Helen Zille and asked her to eat random things
13 days to elections - news you need to know
11 Julius Malema quotes you'll never forget
DA won't get 30% - Zille

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...