'Eskom must seek alternatives before hiking tariffs'

Eskom is asking Nersa for a 25.3 percent hike it says will help prevent load shedding & keep the lights on.

Nersa's public hearings for Eskom's application for a 25.3 percent tariff hike in Nasrec on 23 June 2015. Picture: Gia Nicolaides/EWN

JOHANNESBURG - Day two of public hearings into Eskom's application for a 25.3 percent tariff hike kicked off this morning with the Democratic Alliance (DA) saying Eskom cannot be stabilised at the cost of the broader economy.

The utility said it needs more funds to buy diesel in order to minimise load shedding, which will cost the economy far more than what it's asking for.

The DA's deputy shadow minister Gordon Mackay said Eskom must pursue alternative funding options before tapping into the consumer.

Mackay said acting CEO Brian Molefe has made out as if there's no other option but to increase the price of electricity.

"Eskom has access to various other funding models. We fundamentally believe that Eskom should stop borrowing and start selling some of its assets or selling equities in its business."

Businesses, organisations and municipalities who have made presentations to the National Regulator are all strongly opposing this hike.

Molefe will have an opportunity to respond before the public hearings close at the end of the day.

Business Unity South Africa (Busa) says there's a general uncertainty about Eskom's future and it needs to prepare for the medium and long term in order to survive.

The organisation has made its presentation to the National Energy Regulator on the second day of public hearings.

Busa's Martin Kingston has warned that if this price hike is approved businesses will be severely affected.

"We need to recognize that we are in highly anemic economic environment. South Africa is not as competitive as it might or should be and that any increase in significant input cost pushes many businesses to the brink of being unviable."

DAY 1

On Tuesday, a number of alternatives were presented to the National Energy Regulator of South Africa (Nersa), which could help Eskom keep the lights on and avoid spending billions on diesel.

Businesses, municipalities and industry experts have been taking part in the hearings.

Energy expert Chris Yelland on Tuesday said Eskom may have to continue buying diesel for the rest of this financial year, but insisted that there are viable alternatives for the next two financial years.

"Integrated demand management, demand market participation, powered buy backs, domestic time of use tariffs, ripple control receivers."

Desmond Lockie said his company has produced a demand control unit which will shift the load during high peak times to low peak times and target household geysers.

"Just over two million VCU's can replace that entire diesel peak of capacity, which means that in year one Eskom will save R9.8 billion."

The public hearings are expected to continue today and Nersa is expected to make its final decision before the end of this month.