- Chris Yelland, energy adviser to the Organisation Undoing Tax Abuse (OUTA), has prepared an excellent submission in response the publication of Eskom’s revenue application and the associated NERSA consultation paper for its sixth multi-year price determination for the three-year period commencing 1 April 2025.
- OUTA’s core argument is that Eskom’s application for a 66% revenue and price increase—proposed at 36.15% for 2025, 11.81% for 2026, and 9.1% for 2027—is excessive and will have adverse impacts on South Africa’s economy, customers, and society.”
OUTA is a non-profit civil action organisation dedicated to working for a better South Africa. OUTA was established to challenge the abuse of authority, and particularly the abuse of taxpayers’ money.
OUTA has a strong interest in the electricity sector, because the sector, including state-owned entity Eskom, has been mismanaged for years, resulting in power supply shortages, higher prices, socioeconomic hardship for electricity customers, substantial bailouts with taxpayers’ funds (which should have been available for alternative socio-economic spending), and a devastating impact on the economy.
Image credit: OUTA
OUTA’s is of the principal view that a dedicated national effort and focus is required to address issues of energy poverty, energy access, energy affordability, and the price of electricity which is spirally out of control.
OUTA argues that despite the massive revenue and price increases over the last 15 years, Eskom’s primary focus in its MYPD6 revenue application, remains to ensure cost reflectivity by increasing its revenues and electricity tariffs still further, while paying little attention to the many other alternatives and options of reducing its cost structure and improving its performance and efficiency.
In particular, the Eskom MYPD6 revenue application broadly demonstrates:
- Inadequate signs of self-discipline in reducing Eskom’s cost structure to ensure cost reflectivity.
- Inadequate signs of self-discipline in reducing debt and finance costs to ensure cost reflectivity.
- Inadequate signs of self-discipline in reducing losses to ensure cost reflectivity.
- Inadequate signs of self-discipline in improving its financial and operational performance and efficiency to ensure cost reflectivity.
- Inadequate signs of self-discipline in disposing of non-core assets that would reduce debt and associated debt service costs.
- Inadequate appreciation by Eskom of the negative impacts of its massively increasing electricity prices on society, the economy, and customers of electricity.
Link to the full response HERE: Response to NERSA – ESKOM MYPD6 Application
Author: Bryan Groenendaal
Mr Chris Yelland, managing director, EE Business Intelligence (Pty) Ltd. Chris is an internationally respected energy analyst, consultant and electrical engineer. He is considered an expert on the South African energy market. Follow Chris on X – @chrisyelland
