Nersa to allow Eskom further increase in 2018
The National Energy Regulator of SA gives Eskom a further increase in 2018, possibly pushing the rise for the year to more than double that of inflation
Electricity tariffs are to rise more than the 5% increase already set for 2018 after the National Energy Regulator of SA (Nersa) announced on Thursday that it would allow Eskom to claw back R33.2bn of its expenses from previous years.
But it is not possible for now to say how exactly tariffs will be affected as Nersa has not decided how the additional increases will be phased in or over what period of time.
Nersa said that it considered it would be fair for Eskom to raise an additional R32.69bn, which would be spread over the next three years. If split evenly this would be about R10.8bn a year. This equals about 6% Eskom’s R177bn revenue for 2017-18.
The process of clawing back expenses from previous years is allowed so that Eskom can compensate for costs it had not anticipated at the time that it made its tariff application. However, it is scrutinised carefully by Nersa.
Eskom had asked to be allowed to recoup R66.6bn but was only allowed half this amount in an indication that the regulator is still intent on being tough on Eskom.
In a completely separate process, Eskom has asked the courts to review the 5% tariff granted by Nersa earlier this year for 2018. Should it be successful, the court will ask Nersa to reconsider the tariff decision. This would mean that electricity tariffs would rise even more than has been anticipated.
• Correction: June 14, 2018
An earlier version of this story estimated an overall 11% increase for 2018, but it is not possible to estimate at this point.