15 May 2008
Windhoek — THE electricity supply crisis in southern Africa, caused by dwindling surplus capacity of South Africa's power utility Eskom over the past year, might cause even more headaches for consumers if Eskom is granted a massive 60 per cent tariff hike next week.
Eskom was already granted a 14 per cent tariff increase this year by South Africa's regulating agency Nersa, but applied a few weeks ago for another increase of nearly 60 per cent, which sent shock waves through the mining sector and private households.
An article in Business Day warned that if Eskom gets its way and electricity prices double over the next two years, inflation could breach its previous record of 11,3 per cent in the next few months.
This would bring a similar inflation hike in Namibia, which imports over 80 per cent of its goods from South Africa.
Namibia also imports bout 40 per cent of electricity from Eskom.
Even South African Reserve Bank Governor Tito Mboweni criticised Eskom's price hike request as "irresponsible", saying there were less damaging ways for the power utility to obtain money for desperately needed new power stations.
Meanwhile, senior ANC party officials have sought legal advice after allegations by whistle-blowers and a 12-page analysis of South Africa's power crisis accused Eskom management of serious mismanagement.
The analysis suggested that management might have inflated profits by diverting funds earmarked for maintenance of power plants to money-market instruments that falsely boosted the corporation's financial results and earned them massive bonuses of altogether R10 million.
Sunday Times reported last weekend that the document noted that Eskom developed a maintenance scheme which encouraged its management to earn bonuses by cutting expenditure on the system's ageing generators.
Savings made on the maintenance budget were then diverted to private-sector investments.
A source said some ANC party leaders believed the forced load shedding - which suddenly was halted last week - had been engineered to support the corporation's demand for the 60 per cent price hike.
Eskom spokesman Fani Zulu however said the whistle-blowers' points were "non-issues".
A national energy summit organised by the National Economic Development and Labour Council (Nedlac) will take place in Johannesburg this Friday and it will focus on the proposed Eskom 60 per cent tariff hike.
The last-minute summit, which was originally called for by the ruling ANC in order to bring government, business and civil society together to discuss the future direction of energy, will take place before the May 23 Eskom tariff hearing by the National Energy Regulator of South Africa, Nersa.
Both Nedlac and the ANC had requested the regulator to allow more time for stakeholder consultation.
According to the South African Petroleum Industry Association (Sapia), the demand for diesel in South Africa has increased by 12 per cent over the past year, largely due to economic growth, infrastructure development, and the current power crisis.
Diesel now costs over ten rand in South Africa and the same applies in Namibia from tomorrow, when yet another fuel hike burdens Namibians even more.
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