The City of Cape Town last week rejected Eskom’s application to hike the electricity price by 20,5%.
Cape Town mayor Geordin Hill-Lewis on Wednesday wrote a letter to Eskom CEO André de Ruyter asking him to formally withdraw Eskom’s application to increase the price of electricity by 20,5% in the 2022-2023 financial year.
He suggested that the application be revised to bring the planned increase in line with inflation.
“Capetonians simply cannot afford this increase. It is unfair, unaffordable and unjustified. Like the majority of South Africans, many Capetonians are struggling to make ends meet. The pandemic and national lockdown led to the closure of hundreds of businesses in our City and the loss of thousands of jobs. Our residents are faltering under the burden of the rising costs of energy, fuel, food, and basic consumer goods,” Geordin Hill said in a statement to the media.
“The consumer price index (CPI) is currently stated as 5,5%; this would have been a more reasonable tariff increase for Eskom. The price of electricity has risen by 307% over the past 13 years, far exceeding inflation. Despite paying more for power, South Africans have experienced an unreliable electricity supply – 2020 and 2021 were two of the worst load-shedding years on record,” he said.
Geordin-Hill said it is clear that Eskom needs to take urgent steps to reduce its debt and improve its financial sustainability, but that passing the bill on to struggling consumers should not be the default solution.
He suggested that Eskom rather reduce their bloated payroll and cancel tenders with suppliers who provide Eskom with goods and services at massively inflated prices and to recover money that has been looted during the period of state capture.
“Moreover, the planned increase will further limit struggling businesses’ ability to operate profitably, and to sustain and create jobs. It will destroy hope of economic recovery in South Africa and add to our burden of poverty.
“The City will furthermore petition Salga members, the national energy regulator (Nersa) and other stakeholders to oppose Eskom’s application if they fail to revise it.
“It is an extreme injustice that ordinary Capetonians – and, indeed, residents of every municipality in the country – will be forced to bear the cost of Eskom’s inability to fix its own problems.”
Citizen activist Sandra Dickson, founder of STOP COCT, says this application of Eskom is a sure sign of another state owned entity for which government has no solution nor control over.
Dickson says Capetonians already receive under 40 units for R100. Nersa is required to table the 2022-’23 price determination in Parliament by no later than 15 March, which means there is still time for Eskom to revise its application.
