Op-ed: Ted Blom on where Eskom tariffs are heading
Op-ed: Ted Blom on where Eskom tariffs are heading. Image: 123rf.

South African metropolitans have implemented tariff hikes with effect from 1 July 2019, for various services that they deliver to city dwellers including electricity, solid waste collection and potable water.

However, when it comes to the increase in electricity rates, municipalities are being blamed for not following proper procedures in implementing the hikes.

The energy regulator, Nersa, has given the Tshwane municipality seven days to explain why the metro wants to increase fixed charges to customers.

The regulator stated that the Tshwane municipality’s current application for a hike is incomplete.

According to energy expert Ted Blom, more than 90% of municipal applications for tariff increases are not valid and “probably illegal as they have not submitted ‘Cost of Supply’ studies to justify increases”.

Blom pointed out that at this stage the regulator is only focused on one municipality that approached it for ratification of higher tariffs than recommended or structure changes – and in this case its Tshwane.

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Eskom also in breach of NERSA rules

According to Blom, tariffs have increased more than 500% over the last 10 years, “people can’t afford it anymore,” he noted.

The energy expert also stated that the national power utility, Eskom, “is also in breach of Nersa rules. It has not supplied Cost of Supply reports for many years”.

On the other hand, he commended the new management at Nersa.

Blom said: “The ‘New broom’ at Nersa is busy improving compliance with rules. This has to be applauded. Let’s hope she uses this broom on all defaulting municipalities and Eskom.”