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Eskom News - Page 1

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Eskom 'needs overhaul'

8  Dec  2009
Economists said Eskom's request for a 30% equity investor to help pay for its R140bn Kusile power station is "a step in the right direction", but a complete overhaul of the country's power generation industry is required. Econometrix economist Tony Twine said the South African government was "managing to save face" as it had not hesitated in the past to rubbish the notion of privatisation. "It is a step in the right direction as it demonstrates a recognition that the government cannot recapitalise Eskom

Electricity prices pose major inflation threat

2  Dec  2009
The scale of South Africa's impending electricity tariff increases are the biggest single threat to the country's inflation outlook. Eskom's price increases have already added 91 percent to the cost of electricity since 2005, compared with overall cumulative inflation of 35 percent over the period, according to Mike Schussler, the chief executive at Economists.co.za."Over the last two years inflation was at least 1.5 percentage points higher than it would otherwise have been, due to the direct and ind

New Eskom tariffs better, but...

2  Dec  2009
Business groups yesterday welcomed Eskom's softer tariff hike request, but warned that the revised proposal would nevertheless undermine growth in a post-recessionary environment and push inflation to unacceptable levels. Business Unity SA (Busa) called for an urgent review of Eskom's funding model, combined with bold measures to unlock private capital, particularly in the form of independent power producers (IPPs). "We view the revised proposal as still being on the upper side. It could still have

Zuma supports R28bn Eskom loan

24  Nov  2009
"The president wrote the letter to emphasise how important Eskom's development programme is for South Africa," National Treasury head Thoraya Pandy told Sake24. The government has also given guarantees for the loan. It could be approved early next year. The money would be used to finance, among other things, the construction of a solar-power installation at Upington, a railway line in Mpumalanga and the Medupi coal-fired power station near Lephalale in Limpopo. The electricity utility has been negotiating

SA could have world's most expensive power

19  Nov  2009
South Africa could have the world's most expensive electricity if Eskom gets it tariff increases, an economist said on Thursday. "South Africa's electricity is more expensive than electricity in the US, Israel and Mexico and if Eskom gets its 45 percent increase every year for three years, SA will have the most expensive electricity in the world," Mike Schussler told a presentation on Eskom in Johannesburg entitled "Recovery or Eskom". "We keep being told that we have the cheapest electricity in the world

Eskom to revise tariff proposal

16  Nov  2009
Consumers will be relieved that power utility Eskom has been compelled to revise its proposed 45 percent a year increase over three years to 2012. Eskom was due to submit the revised tariff proposal by November 30, Public Enterprises Minister Barbara Hogan said last week. The revision comes after responses to the application from the National Treasury, the SA Local Government Association (Salga) and business organisations. Salga and local business emphasised the unviability of the proposed increases as

Electricity hike a death threat for car part makers

26  Oct  2009
Another six automotive component manufacturers are seriously concerned about their continued survival. This follows the first confirmation of the names of major automotive component companies that have already closed. The closure of East Rand-based Kolbenco, the last remaining piston manufacturer in the country with the loss of 320 jobs, and the liquidation of Atlantis Forge in the Western Cape with the loss of about 400 jobs, were previously reported. Others that have closed include RAH Auto, Powdermet,

Public left powerless

18  Oct  2009
Cash-strapped South Africans will have to work even harder to reduce their electricity consumption and, somehow, prepare for proposed massive Eskom tariff hikes. Power bills are set to triple in the next three years, and local ratepayer organisations are concerned that many people will face severe financial difficulties and could be forced to sell their homes or businesses amid the spiralling costs. To counter this, homeowners will have to consider power-saving measures, including the use of solar power.

R24bn Rio Tinto smelter scrapped

16  Oct  2009
The $3.25 billion (R24bn) aluminium smelter planned by Rio Tinto for the Coega industrial development zone (IDZ) has been scrapped due to the shortage of electricity. Rob Davies, the Minister of Trade and Industry, said yesterday that the reality was that the energy system in the country did not make it viable to move ahead with the smelter. A joint statement by Rio Tinto, Alcan, the Department of Trade and Industry, Eskom, and the Industrial Development Corporation said they "acknowledge that although some

Eskom's plan a disaster

14  Oct  2009
Eskom's latest proposal to increase electricity prices by 45 percent annually for the next three years will have an inflationary effect on the economy and lead to a series of interest rate hikes that could cripple many households and businesses financially. This was the reaction of economists and consumer groups to an application made by Eskom to the National Energy Regulator of South Africa (Nersa) yesterday in which it proposed to increase electricity tariffs. This was according to the parastatal's

Eskom wants hike for next three years

13  Oct  2009
Electricity parastatal Eskom wants a 45 percent tariff hike every year for the next three years. This is according to its Multi Year Price Determination submission document to the National Energy Regulator of SA which was handed to the media before a briefing in Johannesburg on Tuesday. There were other options, but Eskom recommended this option be considered as it "mitigates the impact of price increases on customers and the economy and provides for a sustainable long-term solution". The parastatal said

Eskom powers inflation shock

9  Oct  2009
Power utility Eskom's proposed electricity tariff hikes would raise inflation, both directly and indirectly, by between 3.45 percentage points and 12.7 percentage points in the first year, putting pressure on the Reserve Bank to raise interest rates, an economist said yesterday. The Reserve Bank's annual inflation targeting band ranges from 3 percent to 6 percent. The consumer inflation rate fell to 6.4 percent in August. The inflationary impact of the hike is based on electricity prices increasing by bet

Power reserves hinge on demand going down, says Eskom

7  Oct  2009
Eskom chief executive Jacob Maroga says it is hoping to recover a healthy power reserve margin by 2014. Briefing MPs in Parliament on Tuesday, Maroga revealed the power utility was still short of meeting its ideal reserve of 15 percent or higher.. The lack of reserve capacity was largely blamed for rolling power cuts experienced across the country in 2007 and 2008. Maroga told MPs Eskom can only build up its reserve margin if demand goes down. ďReserve margin is a factor of capacity and demand. We donít

Eskom to increase free power to poor

7  Oct  2009
Eskom had proposed an increase in the allocation of free basic electricity in its tariff increase application as a way of shielding the poor from substantial hikes in electricity prices, Eskom CEO Jacob Maroga said in Parliament yesterday. A big hike in electricity tariffs is expected when the National Energy Regulator of SA (Nersa) decides on Eskomís multiyear tariff application and the only way that this will be politically acceptable is if measures are proposed to limit the effect on the poor ó a

Eskom stalls R19bn power station sale

7  Oct  2009
Eskom has been blamed for jeopardising a $2.5 billion (R18.5bn) project that could create thousands of jobs and reopen a power station that could add as much as 1 500 megawatts to the national grid. The Ngagane power station at Amajuba Municipality in KwaZulu-Natal, shut down 18 years ago, was put up for sale by Eskom last July, but the utility has not followed through with the sale. The Southern Africa Power Consortium (SAPC) was shortlisted as one of the two preferred bidders to kill the old power unit
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