Recent electricity price hike proposals put to the National Energy Regulator of SA (Nersa) had been characterised by a “pick a number… any number” approach, which indicated that the regulator and Eskom were unable to forecast prices appropriately because of cost and financial management inefficiencies, a member of the National Planning Commission argued last week.
Eskom’s cost controls and financial management “have been less than optimal”, but the state-owned electricity monopoly needed to earn a profit and large electricity price increases over the past five years had been necessary, commission energy expert Anton Eberhard said.
Addressing the Cape Town Press Club in the wake of the Nersa hearings in the city on Eskom’s pricing proposal, Eberhard, who is a professor at the business school at UCT, said Eskom’s proposal of annual 16 percent hikes until 2018 had come under “unprecedented scrutiny… which is a good thing”.
