May 29, 2008
Nersa settles into deliberation mode after intensive hearing processBack
© Reuse this After having received more than 370 submissions and counting, and having posed over 150 questions to more than 40 presenters in its now concluded electricity tariff public hearings, the National Energy Regulator of South Africa (Nersa) now has to reach a decision on whether or not to grant an increase to State-owned Eskom by June 18.
This was highlighted by the fact that, despite the closing date for submissions having passed, some were still rolling in - and Nersa had committed to interrogate even the late submissions.
Bukula said that there had been a common theme to many of the presentations, which was that there should be "smoothed" pricing methodology over a five-year period
This, however, left Nersa with a conundrum, as Eskom had only applied for a hike for 2008/9, and had only submitted figures and forecasts covering this year, relating to primary energy and demand-side management costs.
"For us to be able to say we can phase this, we need much more than we have been given," Bukula said in a telephone interview from Pretoria.
"We need an application that shows us the projections for the other years, so it's very difficult."
"To really get to the figures and numbers, we need figures and numbers and forecasts and budgets from Eskom to be able to pin it down," stated Bukula.
Nonetheless, he reassured that Nersa was not entirely rudderless: "What is important is that we know where we are," said Bukula. "We have a very good idea of what the price should be in five years and it's a question of plotting the trajectory of where we are and where we have to go to in five years."
"The principal of phasing-in is a principal that the regulator has always applied, and one that we will continue to apply," he added.
Also apparent through the hearings was the overwhelming perception that there were "policy gaps, or policy vacuums that need to be filled" - particularly around pricing.
However, he said that the proposed policy changes that were discussed in Cabinet some four weeks ago did align with the route that Nersa had already taken, of having a price determination over a given period that would help to smooth increases and avoid any price shocks.
Bukula did not subscribe to the view that the people presenting at the hearings had strayed from the subject of the hearings. "Overall, I don't think that there is any misalignment between what the people have presented and the regulatory regime."
Bukula said that, given the interest shown, Nersa would call a press conference to announce its price increase decision on June 18.
The regulator had originally planned to announce the verdict on June 6, but, given the overwhelming interest, had been forced to extend its schedule.
Eskom has applied for a 60% tariff increase this year after it had been hit by surging coal and diesel costs.
Edited by: Mariaan Webb© Reuse this Comment Guidelines (150 word limit)
Creamer Media Senior Researcher and Deputy Editor Online
Other Regulation News
Article contains comments
Recent Research Reports
Water 2015: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2015 Report considers the aforementioned issues, not only in the South African context but also in the African and global context in terms of supply and demand, water stress and insecurity, and access to water and sanitation, besides others.
Input Sector Review: Pumps 2015 (PDF Report)
Creamer Media’s 2015 Input Sector Review on Pumps provides an overview of South Africa’s pumps industry with particular focus on pump manufacture and supply, aftermarket services, marketing strategies, local and export demand, imports, sector support, investment...
Liquid Fuels 2015: A review of South Africa's liquid fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2015 Report examines these issues in the context of South Africa’s business environment; oil and gas exploration; fuel pricing; the development of the country’s biofuels industry; the logistics of transporting liquid fuels; and...
Road and Rail 2015: A review of South Africa's road and rail sectors (PDF Report)
Creamer Media’s Road and Rail 2015 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail infrastructure and network, the funding and maintenance of these respective networks, and...
Defence 2015: A review of South Africa's defence sector (PDF Report)
Creamer Media’s Coal 2015 report examines South Africa’s coal industry with regards to the business environment, the key participants in the sector, local demand, export sales and coal logistics, projects being undertaken by the large and smaller participants in the...
Real Economy Year Book 2015 (PDF Report)
There are very few beacons of hope on South Africa’s economic horizon. Economic growth is weak, unemployment is rising, electricity supply is insufficient to meet demand and/or spur growth, with poor prospects for many of the commodities mined and exported. However,...
This Week's Magazine
The BMW Group will invest R6-billion at BMW Group South Africa’s (BMW SA’s) Rosslyn plant to produce the next-generation X3 sports-activity vehicle (SAV) for the local and export markets. Rosslyn will continue production of the current 3 Series through its lifecycle,...
The lack of consequences for poor performance and transgressions on the part of contractors remains a significant hurdle to tackling South Africa’s service delivery challenges, delegates heard at the Consulting Engineers South Africa Infrastructure Indaba, on...
City of Ekurhuleni executive mayor Mondli Gungubele earlier this month officially named the city’s bus rapid transit (BRT) system, Harambee.
About 58% of unstructured data stored by companies is dark data, which means that the value or regulatory importance of the data has not been determined. Subsequently, most of the stored data add costs, rather than increasing revenue or reduce regulatory risks, says...
Effective logistics, import/export and manufacturing consulting services require detailed industry knowledge and experience, but can add significant value to these industries by providing expert advice on various technical elements in their value chains, says...