Wednesday 03, October 2018 by Bloomberg

Eskom to recover $2.2 billion of South Africa electricity costs

 

South Africa’s standard electricity users will bear the brunt of the ZAR 32.7 billion ($2.2 billion) the state-owned power utility can recover in unbudgeted costs incurred in the 2014 to 2017 financial years, the energy regulator said.

Eskom Holdings SOC Ltd. is able to raise power prices by at least 4.4 per cent starting April 1 to claw back the expenses through its so-called regulatory clearing account, the Pretoria-based National Energy Regulator of South Africa said in an emailed statement Tuesday. It first announced the amount on June 14, and today said standard tariff customers will pay for ZAR 31.1 billion of that, with international clients and those on negotiated pricing agreements footing the bill for the rest.

The utility is facing financial strain as a result of factors including weak demand, delinquent municipalities that don’t pay their bills and widespread allegations of corruption. Eskom wanted to recoup ZAR 66.6 billion for the three financial yeas through end-March 2017.

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