Photo by: Duane Daws
The Opposition to Urban Tolling Alliance (Outa) – as part of its broadening mandate into matters of tax abuse – has contracted energy analyst and former Eskom executive Ted Blom to head up its challenge and objections to Eskom's 16.6% electricity tariff increase request to the National Energy Regulator of South Africa (Nersa).
Outa believed Eskom’s R22.8-billion claim in terms of the Regulatory Clearing Account (RCA) was unjust and that most of the claim should have been averted through more prudent management in numerous areas.
Blom would represent Outa at the RCA hearing on February 5, which formed part of the public participation process with regard to Eskom's claim to recoup ”shortfalls” for lower-than-projected sales.
Notwithstanding the fact that the official period for public submissions was technically closed, Outa urgently invited public comment on Eskom's proposed hike.
“Further, we have provided a template in which the public can express their objections and comments on this issue. The greater the participation, the better Outa will be empowered to illustrate to Nersa and Eskom the extent of public interest and outrage, thereby refuting the assertion that there is a general lack of interest and thus acceptance by the public,” the agency said in statement.
Blom added that besides the strong case that had already been made against the unaffordability of the proposed back payment and future increases, there were “glaring concerns” that speak to the inefficiencies within Eskom.
“From its once respected position at the turn of the century as a leading low-cost energy generator, Eskom has sunk to the bottom quartile of energy production utilities in the world, with electricity costs having escalated by over 500% in the last ten years,” he said.
Some of the matters Outa would raise at the hearings included Eskom’s use of previously inflated and inaccurate sales and demand projections to justify tariff increases in an effort to “claw back” its loss of income and over-expenditure and its intention to pass a preventable and unfair over-expenditure, estimated at R10-billion onto consumers.
Further, Outa said it would also oppose Eskom’s intention to pass inflated costs of coal, diesel and transport on to consumers, and absolve itself of responsibility for controlling what it sees as “push through costs” it has “no control over”; electricity being exported at a loss and the parastatal’s “serial failure” to maintain its assets since 2010.
“If Nersa is serious about executing its mandate and responsibilities to the public, we expect no increase or possibly even a decrease in the tariffs,” Outa said.