Eskom Says Energy Regulator’s Tariff Hikes Not Enough, Seeking Court Intervention

Riyaz Patel

Cash-strapped power utility Eskom is heading to the courts in an effort to force the national energy regulator to reconsider electricity tariffs for the next three financial years.

The move comes after the National Energy Regulator of South Africa (NERSA) outlined the reasons for its Multi-Year Price Determination (MYPD4) for the 2018 financial year. 

The state-owned power utility said NERSA’s decision in March – which set out tariff increases of 9.41%, 8.1% and 5.22% for the next three years to 2022 – had left Eskom with a shortfall of approximately R102bn compared to to the hikes that it initially asked for.

In a statement issued Friday, Eskom said the key reason for this shortfall was NERSA’s decision to offset the envisaged government support or R23bn per year against the return on assets.

“This resulted in the return on assets in the decision being approximately negative 1% for each of