Cost of electricity

Eskom demands 53% hike
18/03/2008 21:56 - (SA)

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Cape Town - Eskom wants to raise its tariffs by more than 50%, the National Electricity Regulator of SA (Nersa) announced on Tuesday.

If granted, the increase will replace the 14.2% hike Eskom was allowed by Nersa in December last year.

That increase is scheduled to come into effect from April 1.

Nersa said: "Eskom has applied for a revision of the price for 2008/'09 from 14.2% to 53% increase (sic) or a 60% nominal increase."

It said Eskom wanted the revision because of what the utility said were its higher primary energy costs, and "accelerated demand side management" costs.

"In the light of the current electricity supply shortage and load shedding in the country, the energy regulator will give urgent attention to Eskom's application and make its decision after following due process."

Nto Rikhotso of Eskom's media desk confirmed earlier that the new application would be lodged on Tuesday afternoon, but that she could not reveal the increase sought.

She said Nersa would open up a public-participation process once the request was lodged.

"It's their prerogative to communicate what we have submitted to them," she said.

R10m performance bonuses

In allowing a 14.2% hike last year, Nersa rejected Eskom's bid for 18.7%.

Eskom said at the time it needed the increase to maintain effective operations following a steep increase in coal cost and the need to finance capital expenditure.

Its managers are scheduled to receive performance bonuses of shares valued at R10m at the end of this month.

The hike - whether 14.2% or 53% - comes in the wake of a 2c a kiloWatt hour electricity levy announced last month by Finance Minister Trevor Manuel, and amid a new round of nationwide power cuts.

Reacting earlier to media reports that the hike sought was 24%, trade union Solidarity said South Africans could not afford the increase.

It urged Nersa to reject the request.

More cheerful news from Eskom on Tuesday afternoon was that South Africans would probably not be left in the dark at the Easter weekend.

Load shedding to continue

It said in a statement that two of the nine generating units that had been out of action on "unscheduled maintenance" came back earlier in the day, and two more were expected to come on line on Tuesday evening.

"However, load shedding will continue until after evening peak (21:00) as the wet weather continues," it said.

"The cold and wet weather has increased the demand for electricity and adversely affects coal handling at the power stations."

Eskom said it was load shedding up to 2 500mW, and the risk of cuts would remain until Thursday.

"We don't expect any load shedding during the long weekend as demand patterns are historically lower during holidays," said Erica Johnson, Eskom's chief officer for networks.

Earlier on Tuesday, before any units were restored, Eskom spokesperson Andrew Etzinger said the power situation was "extremely serious".

He warned that in the unlikely, but possible, event of more generating-unit failures, power to mining companies would have to be cut.

Rikhotso said that mines were operating on rationed power, and the long-term plan was that this would be "ramped up" in stages.

An announcement on Monday that Gold Fields had been allocated additional power for use at its Kloof and Driefontein gold mines formed part of this process.

"It's going to be done for all of them," she said.

Possible class action

In January, power shortages forced gold and platinum mines to shut down for five days.

Solidarity announced on Tuesday that its leadership had resolved at an "emergency" meeting to prepare for a possible class action on behalf of mineworkers "should Eskom persist with plans to reduce electricity supplies to mines".

It said it would send a letter to Eskom warning that workers who lost their jobs due to negligence on the part of Eskom or government would be entitled to claim damages.

"Reduced electricity supplies to mines will almost certainly result in job losses," it said.

"Power provision at 90% of normal consumption (the current level to most mines) can cost as many as 20 000 jobs."

Solidarity also would ask President Thabo Mbeki to appoint an independent team to support him in seeking a solution to the electricity crisis.

Managing your electricity

We have put together a unit capable of controlling two geysers and a stove. Typically controlling the geysers with a timer firstly to reduce time of use watt hours and also to reduce total Kw by ensuring that the geysers are never on-load at the same time and further to automatically switch both geysers off the minute you have switched on the stove. Once cooking has been completed and the stove has been switched off the timing cycles on the geysers would resume automatically. We are confident that we can achieve a 30% reduction in your monthly electricity usage and of course on your electricity bill. These units are supplied and fitted for a mere R4,100.00 per household. This would include traveling provided the installation is within 20km of Fourways Mall. In most instances payback is currently within 24 months however with ESKOM poised to increase their pricing by a minimum 28% this payback period will improve dramatically. Add to this the fact that we are also going to be penalised for not reducing our usage by at least 20% then the above option has no flaws. Contact Thornton Group to arrange your installation. Speak to Roger or Susan on 011 467 0063 or Roger on 084 689 0635 or email roger@thorntongroup.co.za

Energy management

Well we are all aware that our utility is threatening to penalise us if we (the customers) do not reduce our usage, how bizarre is this concept. Imagine Coca Cola encouraging us NOT to purchase Coke and encouraging us to by an alternative brand and then threatening to charge us double if we consume too much coke!!!!!!!!!!

And we the South African consumers sit back and accept this situation as "normal". THIS IS NOT NORMAL AND SHOULD NOT BE ACCEPTABLE.
Reducing one`s carbon footprint is commendable and energy saving and green practices should be encouraged however it is a fact that these practices are often expensive and out of reach for the vast majority. So we must look to the government to encourage and even fund"Green initiatives" so that all spectrum's of the community and the world at large can benefit. The spin off with alternative energy sources is the reduced cost of distribution and with the level of copper theft in Africa, alternative energy sources will pay for themselves over and over again. The typical 15 year payback period for capital expenditure for electrical distribution would still be met however this would be in terms of savings, not profits previously generated from the sale of electricity, so how does one raise capital from "saving" initiatives" ? This should not concern Eskom or the Government as clearly they are no longer interested in selling electricity and they are spending millions on a marketing campaign encouraging us not to use electricity. Something is really really out of line in this picture

energy management

news this morning record defaults on home loan repayments, hello. How many people do you know who are really prospering right now? How many companies are having serious cash flow problems. It seems that finding business is not yet a problem, getting paid however has become a full time occupation. With companies like us in the technical service industry, getting paid is a major problem. The common So our president and his cronies reckon that the energy crisis and subsequent delay in the roll out of new building projects will not affect jobs nor the economy, this is really, really ignorant. On thebelief quite obviously is that electricians and plumbers don't have families, or if they do have families they don't need to eat. This non payment culture in SA is already killing job creation across the board. So this energy crisis is effecting the economy at grass roots level and it can only pull the carpet out from under a crumbling ignorant empire which will collapse in a cloud of dust labeled "the African energy crisis" Load shedding in South Africa is all about not taking responsibility for ones career, position, or title and only concerning oneself with ones own self worth and self importance.

Thought For The Day

Several of our clients have had problems associated with large surges as well as in two cases the loss of a neutral which basically blows all your 220v appliances. The loss of a neutral results in 400v flowing through your 240v appliances. Not good for TV sets, Microwaves , motors, globes etc. My point?
Well here we are getting all excited about ESKOM and associated weak infrastructure and minimal generation capabilities but what about City Power and their ageing and redundant network. In the "glory days" there was preventative maintenance that was budgeted for, so typically underground cables were upgraded on a 20 year cycle. Overhead transmission lines underwent more regular maintenance as did the substations. The council installed all infrastructure and the town planning department were involved so everyone knew what was going on. In recent years developers with some grease money have gone ahead with developments with the infrastructure cut to the bone, this infrastructure is then connected to a municaple bulk supply and handed over to the home owners association to maintain. In many cases city power was not able to supply enough power for the development. The amalgamation of our smaller well run efficient, knowledgeable municaple offices int the Greater Johannesburg Metropolitan council has been a disaster. We have lost so many technically proficient people