Executive Mayor of Stellenbosch Municipality Gesie van Deventer, this week added her voice to the list of mayors in the Western Cape that reject Eskom’s proposal for a 20,5% electricity price increase saying residents can simply not afford it.
Van Deventer, on Friday 14 January, submitted a letter to the National Energy Regulator of South Africa (Nersa) following Eskom’s application. “On behalf of the Stellenbosch Municipality, to which I was duly elected to serve in the best interest of the residents of our municipality, I formally lodged our rejection of the application from Eskom and requested that this application be withdrawn,” she said.
Van Deventer said Eskom’s proposed increase of 20,5%, 15,07% and 10% for the next three years is going to have a detrimental impact on the economy, given that electricity underpins a number of key sectors.
If the regulator approved the tariff increase, local authorities will have to pass this increase onto end-consumers. Since the start of the energy crisis in 2008, the country has seen the cost of electricity increase by 175%, while the sale of electricity dropped by 14,7%.
The increase in electricity prices has far surpassed annual inflation increase over the same period, except for the 2017-’18 financial year.
“Our residents simply cannot afford these increases,” the Mayor pointed out. “The increases are unjustified and unfair. Like the majority of South Africans, many residents and businesses are struggling to make ends meet. The pandemic and national lockdown led to the closure of many businesses in our towns and the loss of thousands of jobs. Our residents are already bearing the brunt of the rising costs of fuel, food, and basic consumer goods. One also has to take into consideration the enormous financial loss of municipality funds as a result of the pandemic.”
She added it is an extreme injustice that ordinary South Africans will be forced to bear the cost of Eskom’s inability to fix the mess it created.
“While constantly being expected to pay more for electricity, South Africans seem to be getting less of it. An increase in line with the consumer price index (CPI) of 5,5% would have been a more reasonable tariff increase for Eskom.
“The time has indeed come for Eskom to take drastic steps to reduce its debt and improve its financial sustainability, but passing the buck to struggling consumers should not be the default solution. Stellenbosch Municipality rejects this proposed increase and requests that it be withdrawn.”
An investigation into the use and generation of alternative electricity energy supplies was adopted by the Stellenbosch Council on 27 January last year.
The joint investigation involving Stellenbosch University, the Council for Scientific and Industrial Research (CSIR) and the Western Cape Government will focus on various potential sources of energy production, including rooftop solar panels, methane mining, allowing the public to generate electricity and sell this to the municipality, purchasing electricity directly from registered IPPs and possibly selling electricity to buyers outside the municipal area.
