Eskom slammed for not being 'transparent'
Nersa has rejected the ailing parastatal’s application for a 25 percent increase.
JOHANNESBURG - Eskom has been heavily criticised for failing to be transparent about its finances and the dates when both the Medupi and Kusile power stations will be completed.
The National Energy Regulator of South Africa (Nersa) has rejected the parastatal's application for a 25 percent increase.
It said Eskom failed to submit crucial information needed for the regulator to consider the application.
Nersa chairman Jacob Modise said, "The application did not provide the mechanism on how the proposed increase, if granted, would be implemented in the current financial year in a manner that is consistent with the requirement of the municipal financial act 2003."
This means, while Eskom will be given the already approved 12 percent, it will not be granted a further hike.
Eskom is now considering its financial options.
Eskom's Khulu Phasiwe says the utility will have to see where they can quickly obtain money to avoid rolling blackouts and to pay for some of the expenses it can't afford without the electricity hike, including diesel.
WATCH: Eskom disappointed by Nersa dismissal.
"We have export credit facilities, warns that we have issued and we will venture into Islamic bonds; we will be looking at all those options so we can continue to buy diesel."
Eskom says it will also study Nersa's reasons for rejecting the utility's full 25 percent electricity hike.
"Together with the Department of Public Enterprises we'll have to sit down and chart a new way forward," said Phasiwe.
The parastatal had pleaded with Nersa during public hearings for more money to avoid load shedding.
The utility argued it needed more funds to buy diesel in order to minimise load shedding and prevent further damage to the economy.
However, the energy regulator's Thembani Bukula, says the power utility failed to provide all the information required.
"When they made the application they didn't show us the calculations of what savings they would have made from the non-operations to the delays in Medupi."
Businesses, the mining sector and municipalities have been adamant South Africans cannot afford another electricity price hike and warned that if it went ahead, industries would collapse and jobs would be lost.
Energy experts say Nersa's decision doesn't come as a surprise.
Eskom can now reapply or only include the information it failed to provide so far.
Meanwhile, Eskom says stage one load shedding will last until 10pm tonight.
WATCH: Nersa dismisses Eskom's application for 25.30% increase.