FSA supports NERSA opposing ESKOM RCL Decision

Free State Agriculture (FSA) fully supports the national energy regulating body of SA, NERSA’s media statement of 10 May calling all interested stakeholders to join them in opposing the courts review application. We consider that the Court decision in ESKOM’s favour to increase prices way above inflation will definitely affect the agricultural sector negatively with repercussions through increased food prices and job losses.

FSA has made representation to NERSA at all of the public hearings held in the Free State as to ESKOM’s application for tariff increases. Each time FSA has emphasised the following facts:

1. The fixed cost component of accounts are unaffordable for farmers, particularly small and family farmers which make up the majority of our membership, and should be exempted from the increases
2. That the consumer not have to bear the brunt for ESKOM’s bad planning decisions; expecting higher energy sales while increasing load-shedding and forcing consumers to install own energy solutions, back-up power and energy savings technology. All this forcing ESKOM into a downward utility spiral!
3. That the agricultural sector as price takers, not only faces higher than inflation price increases from ESKOM, but also in labour costs through the national minimum wage, increasing fuel costs through fuel taxes, etc. and all this making certain production energy (and labour) intensive enterprises unviable leading to job cuts from the sector and food price inflation in the longer run.
4. That the blatant corruption that took place at ESKOM should not be reclaimed and paid for by the consumers.

FSA thus welcomes NERSA’s strong stance in resolving to oppose the High Court application brought by Eskom Holdings SOC Limited (Eskom) against NERSA to review and set aside the Energy Regulator’s decision pertaining to the approval of a Regulatory Clearing Account (RCA) balance of R13.271 billion for the 2018/19 financial year, and the Energy Regulator’s decision to grant Eskom’s supplementary revenue balance of R1.288 billion in respect of the 2018/19 financial year.