Carol Paton Editor at Large

The National Energy Regulator of SA (Nersa), which determines the tariff that Eskom can charge for electricity, has effectively wiped out the R69bn cash injection that the Treasury allocated to Eskom in the budget in February and neutralised the government’s support package. In March, when Nersa announced its decision on Eskom’s three-year tariff application, it calculated the return on assets in rand terms for each of three years. It then deducted the Treasury’s R23bn a year from the total. For example, instead of allowing Eskom a return on assets of R14.28bn in year 2020, Nersa deducted R23bn and calculated a negative return of minus R8.75bn. Overall, instead of a R41bn return on assets over the three years it would have received without the bailout, Eskom was allowed a negative return on assets of minus R27.98bn. While Nersa has not yet given its reasons for the R69bn deduction, Eskom chairman Jabu Mabuza said Eskom’s reading of what had happened was that Nersa viewed the R69bn b...

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