Eskom warns of further tariff hikes

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Eskom Board member, Mteto Nyathi, says high debt levels, low electricity tariffs and poor performance by some managers are affecting the productivity of the power utility.

Nyathi was speaking at a media briefing on the energy crisis hosted by the Government Communications and Information Systems (GCIS) in Johannesburg.

He’s warned consumers of more electricity tariff increases as Eskom is not making money from the current rates paid.

According to Nyathi, the current debt of R400 billion is preventing the company from raising capital to fund its operations.

“We’ve got liquidity issues linked to debt, so the debt has to be sorted out. The second one, we call it a cost-reflective tariff if we continue to sell at the price below which we produce things that business has no future. The third systematic issue is what we call dysfunctional culture – many in management positions not managing. You see itself playing itself out as lack of accountability, people not taking ownership of the problem…no tough conversations with people that are not performing.”

Meanwhile, there have been mixed reactions to the African National Congress’ proposal for a National State of Disaster to deal with the energy crisis.

Some are skeptical that the plan will help the country solve its energy problems, as outlined in the package below: