The National Energy Regulator of South Africa on Thursday granted State-owned company Transnet a petroleum pipeline tariff increase that would allow the realisation of a 5.08% rise in revenue for the next year – well short of the nearly 20% applied for.
The new tariff represented an increase from about R2.795-billion in 2013/14 to about R2.937-billion for the 2014/15 financial year, Nersa outlined in a statement.
This would result in a consequent petrol price rise of 3.8c/l, or a 0.26% increase in the March 2014 retail price of 93 octane petrol in Gauteng, compared with the 7.03c/l increase in inland petroleum product prices had Transnet been granted the 19.88% hike it applied for.
Nersa explained that Transnet Pipelines, the principal operator of South Africa's fuel pipeline system, encountered challenges in the construction of its new multiproduct pipeline (NMPP) project, which caused it to change its application “more than once”.
“These changes postponed the forecast dates at which certain new assets would be brought into operation and, consequently, postponed the dates on which these assets can be added to the regulatory asset base. These changes had the effect of lowering the allowable revenue needed by Transnet,” the regulator said.
Further, Nersa expressed concern that lower volumes pumped through the pipelines were reported over the past two years.
Nersa noted a 7.1% decline in total petroleum volumes pumped from
18.025-billion litres in 2010/11 to 16.741-billion litres in 2011/12, before declining further to 15.9-billion litres in 2013.
However, Transnet forecast an overall 0.9% increase to 16.4-billion litres for 2014.