Outrage at Eskom's proposed tariff hikes

The public are voicing their objections to Eskom’s proposed 16 percent electricity hike.

Eskom's Megawatt Park offices in Sunninghill. Picture: Taurai Maduna/EWN

JOHANNESBURG - Controlling the cost of coal, reducing overheads and running a more efficient operation are among the suggestions to Eskom to avoid a crippling electricity tariff hike.

This emerged during National Energy Regulator of South Africa (Nersa) public hearings into the energy producer's proposal in Midrand on Wednesday.

Eskom wants to raise the price of electricity by 16 percent every year for the next five years.

Eskom says this will help to complete its R340 billion capacity expansion programme and pay off all debts used to finance the construction of new power stations.

The company is currently building three power stations.

Former Eskom executive Mike Deats says the pre-funding model proposed by the power utility will not work.

Energy Intensive User Group's Mike Rossouw said, "Do not award Eskom surpluses of revenue they don't require that makes them inefficient. Eskom needs to be mean and lean by getting just enough revenue to satisfy the building programme and their operating costs."

Nersa has received more than 200 representations and 75 requests for presentations.

Meanwhile, the Congress of the South African Trade Unions (Cosatu) is against the proposed tariff hikes saying it will cripple the working class.

In 2010, the government approved a R20 billion cash injection for Eskom over three years in a bid to strengthen the utility's finances and tame tariff increases.

South Africa's power needs are expected to double by 2030.

The hearings will continue on Thursday.