Johannesburg, South Africa — ESI-AFRICA.COM — 29 August 2011 – The Energy Intensive Users’ Group (EIUG) “’ a non-profit organisation that represents energy consumers across the country “’ says the “overcooked” tariff increases of the South African national power utility Eskom Holdings will negatively impact on the future of the country’s economy.
“The next tariff increases will have adverse effects and far-reaching implications for all South Africans,” it said. “These price increments add additional pressure to industrial customers to just maintain current production levels, and further price increases will result in production halts and job losses.”
The EIUG said primary energy costs had increased by 19.8% this year, a significant rise over last year’s 17%.
At the moment the average tariff was 50c per kilowatt hour. The EIUG expects the tariff to settle around 75c to 80c/kWh by 2016. This means that there would be another 50% to 60% increase over the next three years.
The EIUG went on to say that it would be undertaking an industry-wide impact assessment of the electricity price path. “We have seen a number of refineries and smelters closing down and need to determine how poor the outlook is to ensure South Africa doesn’t shed critically needed jobs.”
Eskom was not immediately available for comment.