Online Reporter
South Africa’s energy regulator has apologised for a 54 billion-rand (US$3,1 billion) blunder in calculating electricity tariffs, a mistake that will be passed on to consumers. The National Energy Regulator of South Africa (Nersa), which sets tariffs for state-owned utility Eskom Holdings SOC Ltd, first flagged the error last month without offering details.
On Wednesday, it informed lawmakers that the miscalculation stemmed from a “data input error” initially identified by Eskom, Bloomberg reported.
Although the problem was identified before the tariff determination in January, it was not corrected at the time and only came to light five months later.
“The error is regrettable; it should not have happened,” Nersa said.
As a result, electricity prices will climb by 8,76 percent in the next financial year, up from the previously approved 5,36 percent, and by 8,83 percent the year after, compared with 6,19 percent.
The increases contribute to an eightfold surge in South African power costs since 2008, according to the Energy Intensive Users Group (EIUG), whose members, including Anglo American Plc and Glencore Plc, account for approximately 40 percent of the country’s national electricity use.
The EIUG has called for a review of the January tariff ruling and urged Nersa to reassess its pricing model.
Although Nersa and Eskom insist the tariff hikes are legally justified, critics argue the move unfairly shifts the burden onto consumers. Many point out that Eskom’s financial troubles stem from years of mismanagement, marked by corruption, an oversized workforce, and heavy reliance on costly diesel, leaving South Africans to foot the bill for the utility’s inefficiencies. — Bloomberg
