SAfrica's rich may shoulder energy price increases

SOUTH AFRICA: Wealthier South Africans may have to pay much heftier energy bills to protect the poor, energy giant Eskom said Wednesday, as it tries to secure a 34 percent increase in rates.

The embattled energy provider is awaiting a decision by the National Electricity Regulator of South Africa (NERSA) on June 25 over the application, which comes after it was granted a 27.5 percent increase last year.

"The increase of 34 percent will have an impact particularly on the poor. It is also happening on the back of a slowdown in the economy. It is only correct we step back and reflect on how we protect the poor," Eskom spokesman Fani Zulu told AFP.

In 2008, NERSA capped the 27.5 percent increase applied on the back of countrywide blackouts that revealed an infrastructure crisis faced by the state-owned power utility at 14.5 percent for the poor.

Speaking on the sidelines of a presentation to lawmakers, Zulu said Eskom could not guarantee wealthier citizens would not end up paying even more than 34 percent.

"If they (NERSA) don't cap it, within Eskom you are able to effect a higher increase within one tariff group and a lower increase to another tariff group and that happens all the time," he said. The bid for higher energy prices was made on an interim basis, and would cover only the current year. The increase would go towards operational costs, primary energy costs, manpower and maintenance costs. AFP