Eskom blames R27b shortfall on Nersa’s low tariff hike decision

On Monday, the utility's general manager for regulation Hasha Tlhotlhalemaje said this could have been avoided.

Picture: EWN

JOHANNESBURG - Eskom said it recorded a shortfall of R27 billion from the 2018/2019 financial year because of the energy regulator's decision to grant them a lower tariff hike.

On Monday, the utility's general manager for regulation Hasha Tlhotlhalemaje said this could have been avoided.

“Basically, the increases were deferred to a later stage. If Nersa had made a more correct decision in the initial stages, then there would not have been such a difference between what is efficient and what was allowed in the decision.”

LISTEN: Nersa allows Eskom to claw back R13-billion in tariffs

The National Energy Regulator of South Africa (Nersa) has granted Eskom approval to recover almost R13.3 billion as part of the utility's regulatory clearing account from that financial year.

This amount will be recovered through tariffs charged to standard customers, special pricing arrangement customers and international customers.

It said the reasons for this decision would be given after some confidential information had been finalised.

Nersa adds that while it recognises that certain government failures occurred at Eskom, the full extent has not been quantified.

The regulator's Nhlanhla Gumede said: "It means that electricity is going to cost R13 billion more than now and already electricity is expensive. Unfortunately, Eskom will then sit back and say 'but we have incurred that cost'. You may look back as a regulator and say 'perhaps some of those costs could have been prevented, perhaps as Eskom you could have been a little bit more prudent' but the fact is, we incurred that cost, so what do we do?"

LISTEN: Nhlanhla Gumede explains the regulator's decision