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Eskom tariff hikes will further increase municipal debts, says Salga

Nersa granted Eskom a 9.4% tariff hike for this year along with an increase of 8.1% for 2020 followed by 5.2% the following year.

Picture: Pexels.

JOHANNESBURG – Following this week’s decision by the National Energy Regulator of South Africa (Nersa) to increase Eskom's electricity tariffs, the South African Local Government Association (Salga)’s representatives for municipalities have argued against the hikes.

Nersa granted Eskom a 9.4% tariff hike for this year along with an increase of 8.1% for 2020, followed by 5.2% the following year.

Salga made submissions at the Nersa hearings rejecting Eskom’s request for a tariff increase. However, Eskom argued that it required these increases to make up for the revenue shortfall from municipal debts, though Salga said it would further increase municipal debts.

The association’s head of electricity and energy, Nhlanhla Ngidi, said consumers would be experiencing a hike of 9.41% plus a 4.4% increase for diffusion pending from the previous regulatory account applied for by Eskom.

“Yes, these increases are exacerbating the municipal debt issue and even though a lot of municipalities are hard-pressed around their reasoning for people not paying for electricity, they are trying hard to pay.”

Listen to the audio below for more.