Carol Paton Editor at large

The National Energy Regulator of SA (Nersa) said on Thursday Eskom’s tariff increase for 2017-18 would be limited to 2.2% when the new prices come into effect on April 1. The decision is based upon methodology applied by Nersa which has a complex five-year tariff system informed by what it considers "allowable revenue". As Eskom is able to make corrections over the five years to recoup additional revenue it can demonstrate it is entitled to over and above the agreed 8% tariff increase, the reconciliation over the five years now only allows for 2.2% in 2017-18, Nersa said. The coming year is the last of the five-year period. The result is that Eskom will face a revenue shortfall for the coming year as the budget for the period would have assumed an 8% tariff increase, which is the approved tariff each year over the period. Nersa said in a statement on Thursday that the decision was a confirmation of the determination of allowable revenue, which was made in February 2013. It was there...

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