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Don’t judge Eskom on ‘mistakes of a few’ in tariff application – acting CEO

Oct 30 2017 09:50
Matthew le Cordeur

Cape Town – Acting Eskom CEO Sean Maritz has urged energy regulator Nersa to judge Eskom on the merit of its electricity tariff increase application, and not on the corruption and governance scandals surrounding the power utility.

He was speaking on the first day of Nersa’s public hearing in Cape Town on Monday, as Eskom seeks a 19.9% tariff hike for the 2018/19 year.

Eskom wants its allowable revenue to increase to R219.5bn, up from the allowable revenue of R205.5bn which Nersa maintained for the 2017/18 year.

IN DEPTH: Why Eskom is asking for a 19.9% tariff hike

“The electricity tariff application comes at a difficult time,” said Maritz. “It comes amid a time of governance and leadership issues and a Parliamentary inquiry into Eskom.

“Eskom views the allegations in a serious light,” he said. “We have laid out corrective actions with ethics and governance taking centre space and integrity becoming core to our values.”

Maritz said Eskom has suspended several executives and said disciplinary action is under way.

Former acting CEO Matshela Koko's hearing was postponed to November 23 after Eskom terminated the services of its evidence leader Sebetja Matsaung. This came after an outburst on Friday, in which he threatened Financial Mail deputy editor Sikonathi Mantshantsha.

Maritz said contracts show governance gaps are being reviewed (with suppliers showing signs of gaps being suspended) and said Eskom is closing its gaps on commercial and governance issues.

“These actions alone will not change how Eskom is perceived,” he said, saying that they face a long road ahead.

“Despite these setbacks, Eskom remains committed to delivering reliable electricity to South Africans,” he said.

In the light of this, Maritz said Eskom is presenting a “correct and honest reflection of our business”.

“I acknowledge as a company we are judged by the mistakes of a few, which have cost us dearly and we will take action,” he said.

However, he asked Nersa to not judge Eskom when considering its tariff application.

“Review the application on its merit, not on information driving public opinion,” he said. “The decision will impact Eskom and the growth of South Africa.”

Anti-corruption advocacy group the Organisation Undoing Tax Abuse (OUTA) submitted to national energy regulator Nersa that Eskom should receive no price increase next year, citing "fraudulent over-forecasts".

“South Africa’s economy can no longer be captured by deliberate and fraudulent over-forecasts which guarantee Eskom massive price increases (its own projections run at 20% per year for five years) – which must then be funded by an embattled public with little recourse from an unsympathetic and seemingly biased Nersa,” said the group.

FULL STORY: OUTA argues for 0% Eskom tariff increase

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