Eskom Watch: Hearings Begin Today

The National Energy Regulator of South Africa (Nersa) will start public hearings today on the state-owned utility’s proposed tariff hikes of 35% annually over the next three years. Eskom is attempting to shore up capital in order to complete its R385 billion expansion; however, critics claim that figure is too much for the government to provide. South Africa would lose R150 billion in addition to half a million jobs being diminished, according to the South African Chamber of Commerce and Industry.

Business owners are attending these hearings to let their voice be heard. “A 35% increase is excessive,” said Graham Briggs, CEO of Harmony Gold Mining Co., which employs about 45,000 people in the country. “We will become less competitive internationally. It’s a threat to some of our operations and jobs.”

“The 35% tariff will have a devastating impact on the economy, on small businesses, on jobs,” said Jonas Mosia,  industrial policy coordinator at the Congress of South African Trade Unions (Cosatu), the country’s biggest labor federation. “We can’t be implementing policies that are contradictory to the government’s objectives” of creating jobs. Mosia said a 20% increase would be sufficient, but if the 35% hike is approved, Cosatu will get its 1.8 million members to strike.

Jacob Zuma, newly elected president of South Africa, ran on a platform that he would create four million jobs by 2014, yet he was unable to reach his goal of 500,000 newly created jobs for 2009. It would appear that Zuma’s four million-goal by 2014 would be even farther behind if Eskom is allowed to carry out its 35% tariff increase. The current unemployment rate of the country is at a staggering 25%.

Meanwhile, Zuma celebrated his fifth wedding on January 4, making Thobeka Madiba wife number three and is engaged to be married again. The ceremony rang with voices singing Zuma’s traditional song, “Awuleth’ Umshini Wami,” meaning “Bring me my machine gun.”

Alternative Energy Africa says: Apartheid is over, but that doesn’t mean South Africa’s problems are over. Celebrating when reaching the four million job increase goal that Zuma campaigned on is surely more important to the residents of South Africa than the president’s weddings. However, AEA wonders just who is considered the first lady of South Africa?

Previous AEA articles on Eskom:

Eskom Granted Tariff Increase Friday, June 26, 2009

Inflation: Sub-Sahara’s Ongoing Problem Monday, September 21, 2009

Eskom’s Figures Called Misleading Tuesday, October 27, 2009

Eskom’s CEO Asked to Resign Friday, October 30, 2009

More Problems for Eskom Wednesday, December 9, 2009

Eskom’s Tariff Hike Affecting SA GDP Tuesday, December 22, 2009

Eskom Funding in Question Tuesday, December 29, 2009

Six Days until Eskom Tariff Hearings Tuesday, January 5, 2010