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Johannesburg - Earthlife Africa was concerned about Eskom's plans to sell off part of the Kusile power station saying on Monday that as a public entity the utility cannot make the decision by itself.
"Earthlife Africa is deeply concerned about Eskom's proposed
plan to sell off a part of the Kusile power station," Earthlife
said, referring to information supplied in the company rates hike application to the National Energy Regulator of SA (Nersa).
"This amounts to, we stress, a partial privatisation of Eskom.
There has been no debate or clear policy decision made on this
issue, as there should be when public assets are transferred to
private hands.
"Eskom cannot make the decision to privatise itself; that is
profoundly undemocratic."
The lobby group see this as a "quick fix option".
"Like most quick-fixes, the long-term costs will be higher, for
a new factor will be added into Nersa's tariff calculations,
fixed-term profit.
"Private investors will require known profits (higher than
Eskom's current rate of return) over a long period (20 to 40 years) before investing. This will mean higher prices for decades."
Earthlife said the alternative was to open up Eskom's long-term
contracts and renegotiate with these customers so that they pay a fair price.
Eskom is hoping for a 35% price rise each year over the
next three years.
- Sapa