The Nelson Mandela Bay Business Chamber has rejected energy regulator Nersa's proposal for a 43.55% hike in electricity prices for municipalities.
The Chamber attended the public hearings which were held in Gqeberha on Wednesday after they kicked off in Cape Town on Monday.
Chamber CEO Denise van Huyssteen said the requested increase is as a result of a range of well documented issues including delays in the commissioning of new power stations.
“The Chamber is opposing this increase which is looking for around R300 billion income through the imposition of electricity tariffs at an above inflation rate for the next three years.
“Transferring these costs to businesses and consumers is simply unsustainable,” Van Huyyssteen said in a statement.
Van Huyssteen said Nelson Mandela Bay Municipality is budgeted to make a staggering R1.3 billion loss in electricity, which previously was a profitable function.
“One of South Africa’s competitive advantages used to be having among the cheapest electricity rates in the world, and now we have a situation where by 2026, medium sized industry in municipalities will be subjected to less competitive tariffs versus other emerging markets.
“Municipal inefficiencies and particularly non-payment to Eskom, is a further burden, which is being shifted to the electricity users,” she said.
“The application includes unresolved municipal debt of R187 Billion, to be funded by Eskom through the tariffs.”
The NMB Business Chamber also said that key issues which need to be addressed include illegal electricity connections and meter tampering.
Van Huyssteen said equally worrying was the lack of investment in routine maintenance and upgrading of the electricity infrastructure.
“This poses a serious risk to the sustainability of businesses and especially those in the manufacturing sector,” she said.
“Within the industrial and commercial areas of the metro, we have tracked 66 major power dips this year and 114 unplanned power outages since January 2023.
“These power outages pose massive risks to our economy among which include production volume targets not being met, loss of export orders, costly damage to equipment and machinery, the elimination of shifts and placement of workers on short time, retrenchments and even relocation of manufacturing plants to other countries or their permanent closure.”
