The National Employers Association of South Africa (NEASA)’s CEO, Gerhard Papenfus says the Eskom crisis has a far-reaching impact and could only be addressed if drastic measures to root out corruption and fraud are introduced in South Africa.
Eskom has welcomed the 18.65% electricity hike and said it appreciates the tough decision made by Nersa. The power utility says it recognises the pressures this determination will place on consumers.
Eskom will implement the tariff increases from the 1st of April. Papentus says consumers need to demand good leadership and an end to this crisis.
“This is the concern we have expressed that this is an 18.65% increase but will it go for the right course or the corruption and fraud continued. We know today we are talking about the increase a week ago we spoke about the mafia controlling Eskom. Eskom’s problem is a political and leadership problem because it can be solved. We are not angry enough we need to let them understand that we are not happy this is happening. Protesting in a way we can because this needs protests it’s not good enough.”
Stage 6 rolling blackouts could lead to job cuts: SA Chamber of Commerce
The Chamber of Commerce and Industry says the negative impact of Eskom’s Stage 6 rolling blackouts could see South African companies cutting staff due to continued rolling blackouts.
The power utility announced this week that 11 of their generators broke down resulting in indefinite rolling blackouts.
Eskom has been mired in a financial crisis for years and is dependent on government bailouts.
The South African Chamber of Commerce and Industry president, Advocate Mtho Xulu, says businesses are losing revenue and can’t even plan for economic growth.
“I think anything beyond the inflationary increase is unaffordable for South Africans and the fact the energy itself is not available, Stage 6 means that half of the day is not available for any economic activity. So this is unjustifiable. We as businesses are calling for only an inflation-linked increase anything beyond that is making the public pay for Eskom’s losses. What this means is that workers are going to start being laid off from operational requirements because they do not need all those workers. We do forecast job losses, halt in investments and we are going to have a tough time with this indefinite load shedding Stage 6.”
Price of electricity will soar in April:
Energy crisis gripping SA
Earlier energy analyst Chris Yelland warned that electricity price hikes will stimulate theft of electricity and increase the levels of non-payments from consumers.
Yelland said the latest hikes will have a huge impact on industries, the economy and the disposable income of consumers.
He further added that the high prices are diminishing returns for Eskom because more and more people will not be able to pay.
He warned that the increases also make the business case for alternative energy more compelling.
“There will be increasing levels of nonpayment, theft of electricity, which is already a problem and also municipal arrears debt because municipalities will not be able to collect money from their customers and therefore not be able to pay what they owe to Eskom. So, there are diminishing returns from price increases.”