QUOTE
South African consumers are in for a new electricity shock when the government implements its plans from May 1 to penalise wealthier and heavier domestic users of power who fail to heed energy savings warnings.
Eskom will target its customers in the upper-income bracket - people living in wealthier suburbs with homes that have good lighting, a geyser, underfloor heating, electrical gadgets and a swimming pool.
Domestic dwellers in better-off suburbs will be asked to slash their energy consumption by 10 percent - or pay a penalty measured on a daily basis. At present, customers pay 40 cents a kilowatt hour (kWh) for energy but when the new tariff structure comes into effect, heavy users would pay as much as R1,50 per kWh during peak periods.
The latest price penalty shock comes after Eskom got permission to raise its tariffs by 14,2 percent this year. In addition, an electricity levy announced by Trevor Manuel, the finance minister, in his budget last month, will also be borne by consumers to raise funds for Eskom's expansion programme.
Ompi Aphane, the director of electricity in the department of minerals and energy, told The Sunday Independent that the new penalty would be levied on customers who did not reduce their consumption in line with a system called "time of use".
He said the department and Eskom were working on a new pricing policy, based on quantity and time of consumption rather than a flat rate, to be implemented in May.
A graduated tariff is proposed, which would encourage domestic customers to save electricity. Changes to the Electricity Regulation Act seek to enforce a savings culture by penalising households that fail to reduce the amount of energy they consume. "South Africans are paying too little for electricity compared to the [cost]it takes to provide it to them," he said.
The time-of-use system would be targeted at the high-income LSM 10 group. "We know where the high users are and will be targeting them specifically," he said.
Eskom and City Power have already begun installing new meters that determine time of use and enable them to build a profile of customers. "Given its costs, the idea is not to put meters everywhere but in areas where there is high use," he said.
While the tariff structure in terms of penalties to be imposed was being finalised, heavy users could expect to pay more for electricity unless they started reducing consumption, said Aphane. "Domestic surveys have shown that some people get by on 200kWh a month while others are using up to 5 000kWh a month.
"Many customers are paying R2 000 a month on their electricity bills, while at the lower end people are spending R20 a month only for lighting and electrical items, like a radio," he said.
In terms of the law, customers paying R2 000 would have to cut down by at least 500kWh a month, and failure to do so, although this would depend on consumption measured on a daily basis, could add as much as R750 to their monthly bills.
Aphane said that during peak times energy suppliers used diesel to maintain their supplies and this cost R2 a unit, so there was no way that consumers could continue to pay 40c for a unit when it cost more to supply the power. "It does not make sense that consumers are getting it cheaper," he said.
Eskom did not respond to questions on Wednesday regarding how it would implement the new system.
Jacob Maroga, Eskom's chief executive, told a media briefing on Thursday that the price of electricity was set to increase because "prices in South Africa are lower than the cost of producing electricity both currently and in bringing in new capacity".
Louis Pieterse, a senior manager at City Power, said the regulations would hit those who did not reduce their energy use. "Currently, the only form of saving is through load shedding, yet people can do much more. By reducing energy use there would be no need for load-shedding,"he said.
Ina Wilken, the deputy chairperson of the South African National Consumer Union, said she was concerned about the penalty price shock. "This will impact on what people pay every month in electricity bills and affect the economy," she said.
Thami Bolani, the head of the National Consumer Forum, said penalising consumers for mistakes made by Eskom was unfair. "The government should hold Eskom accountable for the mess it has created, not put pressure on citizens already paying more than they can afford for energy," he said.
Eskom will target its customers in the upper-income bracket - people living in wealthier suburbs with homes that have good lighting, a geyser, underfloor heating, electrical gadgets and a swimming pool.
Domestic dwellers in better-off suburbs will be asked to slash their energy consumption by 10 percent - or pay a penalty measured on a daily basis. At present, customers pay 40 cents a kilowatt hour (kWh) for energy but when the new tariff structure comes into effect, heavy users would pay as much as R1,50 per kWh during peak periods.
The latest price penalty shock comes after Eskom got permission to raise its tariffs by 14,2 percent this year. In addition, an electricity levy announced by Trevor Manuel, the finance minister, in his budget last month, will also be borne by consumers to raise funds for Eskom's expansion programme.
Ompi Aphane, the director of electricity in the department of minerals and energy, told The Sunday Independent that the new penalty would be levied on customers who did not reduce their consumption in line with a system called "time of use".
He said the department and Eskom were working on a new pricing policy, based on quantity and time of consumption rather than a flat rate, to be implemented in May.
A graduated tariff is proposed, which would encourage domestic customers to save electricity. Changes to the Electricity Regulation Act seek to enforce a savings culture by penalising households that fail to reduce the amount of energy they consume. "South Africans are paying too little for electricity compared to the [cost]it takes to provide it to them," he said.
The time-of-use system would be targeted at the high-income LSM 10 group. "We know where the high users are and will be targeting them specifically," he said.
Eskom and City Power have already begun installing new meters that determine time of use and enable them to build a profile of customers. "Given its costs, the idea is not to put meters everywhere but in areas where there is high use," he said.
While the tariff structure in terms of penalties to be imposed was being finalised, heavy users could expect to pay more for electricity unless they started reducing consumption, said Aphane. "Domestic surveys have shown that some people get by on 200kWh a month while others are using up to 5 000kWh a month.
"Many customers are paying R2 000 a month on their electricity bills, while at the lower end people are spending R20 a month only for lighting and electrical items, like a radio," he said.
In terms of the law, customers paying R2 000 would have to cut down by at least 500kWh a month, and failure to do so, although this would depend on consumption measured on a daily basis, could add as much as R750 to their monthly bills.
Aphane said that during peak times energy suppliers used diesel to maintain their supplies and this cost R2 a unit, so there was no way that consumers could continue to pay 40c for a unit when it cost more to supply the power. "It does not make sense that consumers are getting it cheaper," he said.
Eskom did not respond to questions on Wednesday regarding how it would implement the new system.
Jacob Maroga, Eskom's chief executive, told a media briefing on Thursday that the price of electricity was set to increase because "prices in South Africa are lower than the cost of producing electricity both currently and in bringing in new capacity".
Louis Pieterse, a senior manager at City Power, said the regulations would hit those who did not reduce their energy use. "Currently, the only form of saving is through load shedding, yet people can do much more. By reducing energy use there would be no need for load-shedding,"he said.
Ina Wilken, the deputy chairperson of the South African National Consumer Union, said she was concerned about the penalty price shock. "This will impact on what people pay every month in electricity bills and affect the economy," she said.
Thami Bolani, the head of the National Consumer Forum, said penalising consumers for mistakes made by Eskom was unfair. "The government should hold Eskom accountable for the mess it has created, not put pressure on citizens already paying more than they can afford for energy," he said.
And yet they will continue to supply energy to neighbouring contries...
