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Tshwane rejects 20.5% price hike proposed by Eskom, says Randall Williams

Randall Williams said that The City of Tshwane rejects the excessive tariff price hikes that are being proposed by Eskom. Picture: African News Agecncy (ANA)

Randall Williams said that The City of Tshwane rejects the excessive tariff price hikes that are being proposed by Eskom. Picture: African News Agecncy (ANA)

Published Jan 19, 2022

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Pretoria - The Lotus Atteridgeville Saulsville Civic Association has thrown its weight behind Tshwane mayor Randall Williams in rejecting 20.5% tariff hikes proposed by Eskom for 2022/23.

Williams had said Eskom’s proposed hike would be exorbitant and have a detrimental effect on Tshwane residents and further weaken the struggling revenue of the metro.

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“The City of Tshwane rejects the excessive tariff price hikes that are being proposed by Eskom,” said Williams in a statement on Monday.

Eskom CFO Calib Cassim, in a National Energy Regulator of South Africa public hearing presentation on Monday argued that most of the cost increase was driven by the requirement to increase purchases of energy from independent power producers and the increase in carbon taxes.

However, Lotus Atteridgeville Saulsville Civic Association chairperson Tshepo Mahlangu said people were struggling to make ends meet and would not be used by Eskom to pay for its mistakes.

He said they were not going to allow Eskom or Tshwane to disconnect residents if they could not afford electricity due to new tariff hikes.

Mahlangu said: “This time we stand with the City on matters of tariffs because we can all agree that what Eskom is trying to do is not in the best interests of the people, but its own agenda to use consumers to raise funds to recover a state business that was killed by corruption and maladministration.

“They must employ the Hawks and Special Investigating Unit to probe their employees and friends and take away their assets to recover the money they have been embezzling from the state-owned enterprise. We are not going to sit and watch them use consumers like this.”

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Williams said that despite the National Treasury guidelines proposing an electricity tariff increase of 8.5%, Eskom instead made a submission to the National Energy Regulator of South Africa requesting a series of double-digit increases over the next three years.

The power utility has requested a 20.5% increase for the 2022/23 financial year, followed by a 15.07% increase next year and a 10% increase the year after.

He said that should the three proposed price increases go ahead, electricity purchased from Eskom in three years time would be almost 50% more expensive, which would have a dramatic and negative effect on residents, businesses and the City.

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He said while they acknowledged that Eskom was having financial difficulties and was working towards turning around its business model, it could not shift this responsibility to consumers.

“The unfortunate reality is that even with these proposed excessive price hikes, Eskom services are not guaranteed, as residents and businesses continue to experience regular electricity outages.

“It will also lead to a possible escalation in illegal connections as the cost of electricity would become unsustainable for residents with lower incomes who cannot afford to go off the grid.

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“These combined scenarios will lead to a massive loss of revenue. For many businesses, electricity is a major input cost, especially within the manufacturing and industrial hubs of Tshwane.

“Such substantial increases will significantly raise the cost of doing business in Tshwane, driving costs higher. With such high tariff increases, we expect that for some businesses, it may no longer be viable to do business in Tshwane.

“At a time of economic difficulty across the country, the proposed tariff increases will lead to job losses.

“Tshwane residents and the City cannot afford this as we need sustained economic recovery in light of the Covid-19 pandemic.”

The public has until Friday to comment on the proposed electricity price hike.

Pretoria News

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