Fin24

More power price hikes loom

2012-07-13 15:26

Cape Town - South African power utility Eskom has applied to raise electricity rates by 14.6% per year over five years, a confidential document obtained by Reuters showed on Friday.

Eskom said the increases could be as much as an annual average increase of 19% over the same period, depending on certain government decisions.

Eskom needs to fund an expansion drive and the building of new power plants to keep the lights on in Africa’s largest economy.

Sharply rising power rates have added hugely to the costs of key sectors such as mining in the world’s biggest platinum producer.

One of the world’s lowest-cost electricity producers, Eskom, which provides 95% of the country’s power, was granted three years of 25% power tariff hikes in 2010.

“In the base case Eskom requests revenues totalling R1.07 trillion over the five year period, which translates into annual average price increases of 14.6%,” Brian Dames, Eskom’s CEO, said in the document marked “strictly confidential”.

But this could climb to 19% if the government brings in a carbon tax or builds new plants beyond those currently under construction, the document says. 

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Comments
  • NrGx - 2012-07-13 15:38

    why? - need another party....GO TO HELL!

      Active - 2012-07-13 16:01

      Nope, need to give free power to zimbabwe

      jason.children - 2012-07-13 16:04

      Look I know everyone gets pissed at Government for upping prices and Eskom for upping electricity, but our electricity is some of the cheapest in the world! If you know its going to happen like this over the next 5 years then starting making changes now. Become more energy efficient. Invest in energy saving ideas for you home. Bitch or adapt!

      rugbyfan.sa - 2012-07-13 16:11

      Time to stand together again to fight this like we did with e-tolling. Do not underestimate the power of law-abiding taxpayers.

      Active - 2012-07-13 16:13

      Jason; with this hike it will mean that our electricity bill goes up with 76.5% in three years.

      NrGx - 2012-07-13 16:18

      @Jason - yes it may be of the cheapest in the world, BUT in comparison to our inflation and salaries, it is THE MOST expensive in terms of affordability. Even Eskom themselves admitted that a few weeks back.

      jason.children - 2012-07-13 16:35

      And do you lot think by moaning on news2 that its gonna change????? come come! Im not the evil one here, im just saying instead of bitching, make plans now already.........dont leave it too late! And VOTE VOTE VOTE!!! do you know how many non ANC voting people there are who hate the ANC and bitch about this country and the way its run, but when elections come they use the time off to have a jol and a braai because "my vote wont make a difference" shame on them........every vote counts. And unless you vote you have no say in the running of this country......phew end of rant!

      NrGx - 2012-07-13 16:40

      @Jason...again, you may be right. But the ones who basically decide the vote (majority) get free electricity.

      Active - 2012-07-13 17:12

      One must start somewhere.

      renier.lubbe.7 - 2012-07-13 17:14

      @Jason: The more energy efficient the people get the less power gets sold by Eskom. That is one of the reasons why Eskom has to increase the rates in order to recover lost revenue. It is a vicious circle, the less power they sell, the more we have to pay.

      jason.vanheerden.31 - 2012-07-13 17:28

      Wish our salaries would increase by 14.6%$ pa :)

      Vince.York - 2012-07-14 09:36

      CHANCELLOR HOUSE PROFITS are where? Gwede, Matthews, JZ et al?????????????????????????????????????????????

  • steve.impala.75 - 2012-07-13 15:39

    Probably to fund some more family parties...

  • aldridge.roman - 2012-07-13 15:40

    If the stop using millions of rands on staff outings,then they don't need to ask for more money, bunch of idiots----i will rather use candles and gas heater's, this is not what i voted for(p2345inks)

  • shirley.schlange - 2012-07-13 15:40

    ESKOM must bog off, bonuses, bonuses, packages and we must just have increases as and when it suits them!!!!!!!!!!!!!!!

  • Ian - 2012-07-13 15:40

    so there is no requirement anymore for efficiency? A senseless increase in tariffs, means there is no need for the company to be run efficiently!!

  • eddie.botha.3 - 2012-07-13 15:41

    What a disgrace. After they spent R36 million last year on parties for staff and their families. Worse was that Eskom's spokesman Hil;l;ary Joffe, once a good journalist, defended it by saying it was to thank staff for their commitment and hard work (such as managing outages, I assume)As I said she was once a good journalist... now nothing more than a spin doctor. Shame.

      nadia.graf.50 - 2012-07-13 16:09

      I heard the parties were to motivate the staff. In the current economic climate I would have thought that just having a job would be motivation enough!

  • ricky.hammer.92 - 2012-07-13 15:42

    How about cutting off all illegal connections instead and prosecuting those that practice that habit. Stuff eksdom

  • attie.gerber.1 - 2012-07-13 15:42

    8 mil a year is not enough for dames and don't forget the parties

  • Andre Du Preez - 2012-07-13 15:44

    I must say this is bull.The rest of the anc elite probably need to build theselfs a village the same as king zuma idtent.Goverment is raping the taxpayers and enriching themselfs

  • grace.andtruth.77 - 2012-07-13 15:44

    .......... 19% if the government brings in 'carbon TAX'. WTF is that? You taxing us to death ANC greedy fat pigs! And Eskom wow haven't we paid for enough of your 'family parties'!

      ron.wale.3 - 2012-07-13 16:12

      Public funded organisations should not be allowed parties - by law! Our Constitution needs to protect the taxpayers who fund this country.

  • Tiaan Liebenberg - 2012-07-13 15:46

    Eskom will be voted as company of the year by its employees - how else with more 'morale boosting' parties and ridiculous management salaries. Eskom, the longest gravy train in SA

  • Christo Zeelie - 2012-07-13 15:48

    whats the use complaining guys, no one listens to us (the consumers) anyway. We are being screwed from all directions (fuel, electricity)

  • rontheogre - 2012-07-13 15:49

    These idiots keep on moving the goal posts. If I screw up the planning of my business, party all day, dish out ridiculous salary increases and bonuses then try to defer the costs to my clients I will not have my doors open for long. This is what happens if we allow one entity to have the monopoly in a crucial sector of our economy. Screw Escom and the horse its directors rode in on!

  • blank.afrika - 2012-07-13 15:52

    so, why don't we all do the decent thing and steal power

  • erick.mamba - 2012-07-13 15:54

    Eskom's executive committee should enroll for a CAPITAL BUDGETING COURSE, How can they spend over R36 million on parties when they're experiencing cash-flow problems..

  • jan.human - 2012-07-13 15:56

    Eish!..come.....pay!!!

  • pgibbings1 - 2012-07-13 15:58

    Govt (Eskom) insists on coal stations. And then want to up the carbon tax... Hypocrites

  • michael.digby.9 - 2012-07-13 15:58

    Stuff You Eskom!!! What about the R32m you spent on parties!!! That would have gone a long way!!!!

  • richard.zanner - 2012-07-13 15:58

    Yes I can understand why they need to hike these prices again. That jet for Zuma is rather expensive and as he can hardly ask for a jet tax it must be funded somehow else.

      ron.wale.3 - 2012-07-13 16:10

      Maybe the People of SA should demand that the ANC pay for it!

  • jan.sadie.7 - 2012-07-13 16:03

    Did they not borrow 1 trillion rand the other day from the world bank? Eish - we want more party! The people must pay!

  • tony.langley.399 - 2012-07-13 16:08

    Eskom initially applied for these exhorbitant price hikes to fund capital requirements, but now seem to think these hikes can always exceed CPI. Besides, what other business can expect its customers to pay for its capital requirements.

  • peterjohnjnb - 2012-07-13 16:13

    ......and in other news, Eskom will now allow South African's to make payment of electricity bills in blood. This news comes as the regulator has once again allowed for another exorbitant increase in energy costs. This increase has been allowed despite ongoing record earnings posts by the organisation, seemingly to ensure that the management of the supplier can continue to enjoy above average lifestyles and weekly facials.

  • kobus.meintjes.9 - 2012-07-13 16:14

    It is time that Eskom (mis)management are held accountable for their performance(or lack there of).The same mentality as Zuma and the ANC. Lets spend 36mil on a party and then just increase tarrifs.Lets buy a new aeroplane,bugger the poor and all our promises to them!! Time for a regime change I think.

  • Santosh Maharaj - 2012-07-13 16:14

    These guys are screwing us silly. Inflation will rise and reserve bank will increase interest rates. So we will be screwed from both sides.

  • Dawn Campbell Gibson - 2012-07-13 16:22

    More staff parties...

  • sihleh.mthethwa - 2012-07-13 16:25

    This is a load of bull, you just spent R36 million on a party and yet they say they need to fund an expansion drive and the building of new power plants to keep the lights on in Africa’s largest economy. Its more like keeping the executives pockets full with bonus that they will get.

  • mahomed.mather - 2012-07-13 16:25

    Yes ask for more money so you can spend on even bigger family day meetings next year. Maybe 40 million as this year was 35 million.

  • trevor.pietersen.3 - 2012-07-13 16:29

    They want a BIGGER party

  • trevor.pietersen.3 - 2012-07-13 16:32

    They want a BIGGER party

  • nomcebo.dlamini.90 - 2012-07-13 16:36

    so that thet'll have more parties at our expense.

      Adil Smit - 2012-07-13 16:38

      True

      tsietsi.mshengu - 2012-07-13 16:49

      Yes Nomcebo, the intention is to milk us dry and ensure that we remain poor. So, I'm going to \tamper\ with my meter box so that I get electricity for free like the people in informal settlements. If they could make sure that everybody pays, then there would be no need for more increases. But then we are talking about people (read anc) who are clueless in anything about the economy.

  • luca.delbianco.3 - 2012-07-13 16:39

    I am speechless: where is accountability at Eskom? Is there anybody with a no partisan attitude who could keep Eskom in check?

  • luca.delbianco.3 - 2012-07-13 16:42

    @Jason, this story about SA having the cheapest electricity in the world does not sound correct anymore; if you consider all the various increases in tariffs we had to deal with in recent years.Cheers.

  • johnvkaraoke - 2012-07-13 16:57

    but they can spend 32million on private parties and then pleas that they are bankrupt

  • leonard.rom.7 - 2012-07-13 17:10

    u are ripping the public off we need a change of goverment and city power !we demand change curry on crippling this country so unemployment will double behond help

  • jason.rom.9 - 2012-07-13 17:35

    why don't i get a loan for my business, in fact rather just cripple the country stupid ass

  • Greg - 2012-07-13 17:53

    Stuff you Eskom

  • raymond.abrahamse - 2012-07-13 19:15

    ZOOMAAR-we want more black Managers.

  • brent.bartlett.98 - 2012-07-13 19:34

    As tough as it is, if we are going to keep the lights on then these rises will come - and as long as electricity is included in the SA Stats basket each year then company increases and also the economy has to catch up. What Really grates me, though, is the ESKOM plurges and then their justification of this and the attitude of many South Africans thsat just expect government to give free handouts nstead of pulling themselves up a their boot straps geting a little self motivation and getting out there to make a difference. Things could really take off if more South Africans would just take control of their own lives.

  • peter.fraser.92754 - 2012-07-14 01:00

    So millions get 50kWh free per month. Some big concerns gets for under cost. We supply neighbouring countries at a special rate. Eskoms top guys gets moerse salaries.Eskoms staff are very very well paid.Eskom has massive parties and us, yes us, must pay for the shortfall ? If you are on pre-paid your are stuffed.....so what do you do to rasie awareness that we are being milked ????????????????

  • Arthur Salvado - 2012-07-14 07:12

    There is no end to the feeding frenzy. They can earn and spend what they like because the tax payer is always willing to bail them out. We good at that. Watch out for more bailouts.

  • vivian.harris.73 - 2012-07-14 08:08

    Stop bitching! U know u gonna pay...u always do. Problem is nobody will stand together and not pay for electricity for a month or 2 to show Eskom and the government that we not happy with this crap.

  • Philip Mostert - 2012-07-14 08:35

    I think eskom and municipality should first sort out their billing issues, before raising the cost. If you get billed correctly more people will pay and as result they will have more up to date accounts.

  • Philip Mostert - 2012-07-14 08:38

    Eskom should also not have parties and rather spend money toward correct expenses. Their ceo and directors should all also take a pay cut and no more bonuses!

  • malusi.shumane.7 - 2012-07-14 08:39

    Perhaps it's high time we bloggers came out and displayed our discontent to the gov. We are the ones mostly affected by these irrespensibilities. We need to do something just like egyptians did; meet somewhere and march. This will be the consumers' march, no Cosatu, no Ancyl, no DA- just no one to use us for their benefits. All these are affecting the poor, mostly blacks. Look if you are a public servant in SA you are probably poor too. Let's do somethng manene. Enough is enough!!!

  • ryan.blom.3 - 2012-07-14 09:07

    I own a restaurant franchise company , and the the electricity increases have pushed the monthly electricity bill to the same value as the rent . Next year our electricity bill will be higher than our rent !!

  • ryan.blom.3 - 2012-07-14 09:15

    My restaurants electricity bill is now surpassing my monthly rental !! how is this sustainable ?

  • gregory.jurgens - 2012-07-14 11:03

    19%, party time.

  • cecilia.vanderwesthuizen.5 - 2012-07-14 14:46

    Millions wasted on parties and guess who's going to pay for it? You and me

  • justin.pretorius - 2012-07-14 17:57

    Poor management is to blame and could even sink the economy

  • mouwane - 2012-07-14 20:10

    Here we go again...

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