Minerals Councils warns of dire consequences if Eskom tariff hike is approved

The council said consecutive tariff increases of about 26%, 20% and 9% over three years were simply unsustainable not only for the mining industry but the country as well.

FILE: Eskom's Megawatt Park in Johannesburg. Picture: Eyewitness News.

JOHANNESBURG - The Minerals Council South Africa on Friday warned that Eskom's tariff applications will stifle economic growth and damage the mining sector.

Eskom has proposed a series of tariff increases, with the latest one being 20.5%.

South Africans are already hit hard by high fuel prices and increasing inflation.

The council said consecutive tariff increases of about 26%, 20% and 9% over three years were simply unsustainable not only for the mining industry but the country as well.

It added that four out of 10 adults were unemployed and economic growth had stalled.

The council said the increases represented R279 billion, R335 billion and R365 billion per year, in a three-year period.

In its submission to energy regulator Nersa at public hearings into the tariff applications, the council has warned of dire consequences if the increases are given the green light.

Implementing Eskom's request could severely affect the energy-intensive sectors, which account for 41% of the country's GDP and 44% of employment.