Big business’s energy conundrum
Industry in SA, hit hard by sizeable tariff increases, has warned of the danger that rising power prices pose to the country’s economy. But the big energy users remain tied to the national grid
It’s a simple fact that SA power utility Eskom is in its worst state ever — both financially and operationally. Its debt has ballooned, while its electricity sales continue to decline. It’s also facing severe coal supply shortages and its power plants appear to be falling apart. Yet the mammoth state-owned company now wants a 15% annual increase for the next three years in the price it can charge customers for electricity. In 2018 it got a 4.5% hike in the power price. Consumers and business alike are raising the alarm over the effect of higher power prices, though it is well understood that Eskom, run into the ground through corruption and mismanagement, desperately needs more income. The problem is that no matter how much money Eskom gets, it is clearly unsustainable in its current form. However, any restructuring has so far been crippled by politics. Undoubtedly, something has to give. Business has responded to rising power prices by trying to reduce usage as much as possible. Bu...
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