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OUTA trips Eskom’s Predatory Tariff Hike

Following OUTA’s presentation to the National Energy Regulator, Eskom was denied a 400% tariff hike – and the opportunity to fleece consumers. This followed a hearing held at Nersa’s head office in December last year at which, barring the attendance of a large Eskom delegation, OUTA’s Ted Blom was the lone defender of SA consumers against a price increase on unspecified Eskom Critical Peak Days.

Eskom had argued for the new higher tariff in order to encourage consumers to reduce consumption on days where the utility had underestimated demand. The blunt tool that Eskom wanted to deploy on such days (with a 12-hour warning), was a super high tariff which would have resulted in many businesses facing an unaffordable electricity bill.

Blom, OUTA’s Portfolio Director on Energy, lambasted Eskom for, among other things, ignoring the basic tenants of sampling and for not offering evidence of the sample questions or identity of the population that was sampled. In addition, Blom accused Eskom of using inappropriate methodologies and for taking over 5 years to compile the proposal while failing to consider the practical issues of implementing this harsh tariff.

“It was simply a case of burdening the South African consumer with another complex tariff structure,” said Blom, who further accused Eskom of secrecy and slated the contention that the new Tariff would be revenue neutral – as their very own appendices showed otherwise.

Blom’s final attack on the tariff was that although it would appear to be a voluntary tariff option during its initiation phase, Eskom had slipped into their application the right to convert it to a “mandatory tariff” at a later stage.

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