South Africa’s largest energy consumers have criticized the 54 billion rand ($3 billion) settlement between the state-owned power utility and the regulator, calling for a review of the electricity pricing determination process.
According to Bloomberg, the deal reached last week between Eskom and the National Energy Regulator of South Africa (Nersa), regarding a tariff award—found to be based on incorrect data—will push electricity prices higher, increasing energy costs eightfold since 2008, according to the Energy Intensive Users Group (EIUG).
“The lack of transparency in the settlement leaves much to be desired,” the EIUG said in a statement. Its members, including multinational mining companies Anglo American Plc and Glencore Plc, account for about 40% of the country’s electricity consumption.
“This is especially true regarding the implementation period of this agreement, which was not consulted on and yet directly affects consumers,” the document added.
The price increase is being “phased in to balance Eskom’s sustainability,” the state-owned utility said last week in response to questions about the deal.
The EIUG also urged Nersa to review its January tariff decision and to reconsider its pricing methodology and application, “as it has generally failed to bring stability and predictability to prices.”
Source: Diário Económico
