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Johannesburg - South Africa had deliberately under-priced electricity in the past, Eskom chairperson Bobby Godsell said in Johannesburg on Friday.
In the past, South Africa was not a popular destination for investment and so the government had to provide an incentive and that was cheap electricity," he told the Steel and Engineering Industries Federation of SA.
However, it had been unwise to set the electricity price below the real cost of producing it, Godsell said.
"The government did open up the electricity sector to new players but no one came in because the tariff was half of the cost of production. So we need to address the tariff," he said.
Godsell said Eskom's coal supplies for power stations were now at 42 days.
"Last year the average was 12 days."
Eskom was engaged in a capital expenditure programme of R385bn.
"This is four times the size of the Gautrain project," he said.
"Our programme is on schedule and we think the cost may remain at R385bn - or it could drop."
"Godsell said the debate around electricity in South Africa was not "an Eskom debate".
"It is a South Africa Inc debate involving 48 million South Africans. If we want economic growth then we need more electricity," he said.
Asked to discuss Eskom's latest tariff application, Godsell said that the document would be made public next week and he preferred not to comment at present.
- Sapa