Eskom must clean its house before it asks for more money
According to Engineering News, Eskom is planning to approach the courts to have NERSA's 2018/19 tariff determination set aside.
“Eskom should focus on addressing internal issues and rather use the Courts to address gross mismanagement. NERSA’s decision to grant only a 5.23% electricity tariff increase for the 2018/19 period should stand unchallenged. OUTA is seeking legal advice to ensure that prices don’t increase,” said Ronald Chauke, Portfolio Manager for Energy at the Organisation Undoing Tax Abuse (OUTA).
“Eskom must share a status report about its progress towards recovering the money lost due to poor decisions and corruption that manifested through state capture and other malfeasance during the tenure of the previous executives and quantify such before they turn to tariff increases,” Chauke added.
Eskom’s threat to take NERSA to court may also culminate in a long drawn-out court battle that has the potential to negatively affect the compilation and ultimate submission of an authentic and realistic fourth Multi Year Price Determination (MYPD4) application.
Chauke said that Eskom should also propose ways and means on how to eliminate inefficiencies in its operations and provide an implementation schedule and associated costs and gains of how these restorative interventions would contribute to the Recovery Programme or turnaround strategy that will feed into the compilation of an objective and reasonable revenue requirement application (viz. MYPD4) to NERSA.
“In our request for NERSA not to grant approval for any electricity tariff increase last year, we sighted an ongoing decline in efficiencies, maladministration and corruption, combined with a lack of leadership accountability over the past decade, which had given rise to unwarranted increases for far too long,” said Wayne Duvenage, Chief Executive Officer at OUTA.
More than 23 000 people participated in the public engagement process through OUTA’s channels in 2017. “We will again create a platform for broad participation in the MYPD4 process for South African citizens and OUTA supporters later this year,” Duvenange added.
Last year OUTA submitted a comprehensive report in the public participation process of the 19.9% tariff increase application submitted by Eskom in 2017 (see Eskom's application here).