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Molefe defends Eskom’s power tariff hike

Acting CEO Brian Molefe says they need a 9,5 percent price hike and this is in order to keep buying diesel.

FILE: Eskom’s Acting CEO Brian Molefe. Picture: AFP.

JOHANNESBURG - Eskom's Acting CEO Brian Molefe maintains that load shedding will cost the economy six times more than operating diesel run generators.

Molefe was making his closing remarks at the public hearings into the utility's 25,3 percent tariff hike about 12 percent has already been approved.

#Eskom Brian Molefe making his closing remarks at public hearings into Eskom's proposed tariff hike. GN pic.twitter.com/uo4tw3Gzrm

He has now confirmed that Eskom will not be pursuing a 2,5 percent environmental levy, which is part of their tariff application.

But Molefe says they need a 9,5 percent price hike and this is in order to keep buying diesel to operate the Open Cycle Gas Turbines, which keep the lights on during business hours.

"The cost of load shedding is six times more to the economy and to South African than the cost of OCGs to the economy."

But all organisations, businesses and individuals have strongly opposed the price increase saying South Africans simply cannot afford it and it will result in several industries shutting down and thousands of jobs being lost.

National Energy Regulator of South Africa (Nersa) will make a decision by 29 June.

#Eskom Molefe: didn't say we can't do without the increase, we will try and balance and remain committed to not harm SA. GN

#Eskom Molefe says they have looked at other funding options. NERSA must consider when making its decision consider affordability to poor GN

#Eskom Molefe challenging NERSA about 50% of units which have been maintained break down. GN

GOVERNMENT MUST HELP ESKOM

At the same time, Finance Minister Nhlanhla Nene says the government has no option but to make sure Eskom is put on a proper financial footing.

Members of Parliament (MPs) have been debating two bills, one that will allow for Eskom to get a R23 billion shot in the arm and a second that will allow for a government loan of R60 billion to be converted into equity.

The support package was approved by cabinet last year and Nene gave details in his budget speech in February.

Nene defended the move in the face of opposition criticism about the state of Eskom's finances, leadership and load shedding

"Indeed we do not have a choice but to make sure that this state asset is put on a proper financial footing."

He stood firm in the face of DA demands that he reveal details of the assets the government intends selling to raise the R23 billion.

"Those assets are non-strategic to government. I can tell that before long, before the end of June you will know which assets."

Nene says the support package will shore up Eskom's bottom line, making it easier for it to go to the markets to raise the capital it needs for its build programme.

#Eskom Molefe: it's up to the Minister of Finance whether or not this tariff can be implemented this year that's the legal advice we got. GN

#Eskom NUMSA wants planned load shedding and selective use of diesel generators. GN

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