Call for pre-paid electricity to fund Eskom costs

Hard-pressed SA homeowners are being asked yet again to dig deep into their pockets to further finance Eskom's expansion plans.

And while nobody really questions the need for continuity of supply that these multibillion-rand plans will bring, there is a widespread feeling that the burden of funding could be more evenly spread and therefore more moderate, says Gerhard Kotzé, CEO of the ERA South Africa.

Kotzé was reacting to the latest increase of more than 31 percent granted to Eskom by the National Electricity Supply Regulator (NERSA). The increase follows the hike of more than 20% last year and predictions that electricity costs will double within two or three years.

"There are numerous issues in this context - 'bulk' prices for industry and commerce that are less than for household consumers, municipalities that are happily making significant mark-ups on electricity supply, the lack of a coherent national policy on alternative energies and energy saving devices, the lack of competition in the generation and distribution of electricity and so on.

"Arguably the biggest problem of all, however, is the unofficial electricity rates 'boycott', which is costing municipalities billions of rands. Pre-paid electricity metering would seem to be the solution. This is nothing radical. Such meters are already in use to a limited extent locally and are simply part of life in the UK and the US, for example.

"Their wider use in SA would serve the dual purpose of obliging recalcitrant consumers to pay for their electricity in advance whilst also encouraging more economical use of electricity in general by creating greater awareness of the day-to-day cost.

"Of course such a step is a political hot potato. The alternative however is to continue to hike electricity tariffs indefinitely and thereby reduce consumer spending power, retard economic growth and increase job losses."

Kotzé says that without wishing to be cast as some sort of electricity activist - "and ignoring for a moment the lack of coherent policy on alternative energy sources " - it is abundantly clear that too much of the burden of helping to finance Eskom's expansion plan is falling on a shrinking base of householders.

"It seems equally obvious that spreading the burden of funding Eskom's plans would mean more moderate electricity increases for all. And the most practical way to do that would be to incentivise the installation and use of pre-paid electricity meters, perhaps through differentiated rates, tax deductions or other subsidies."

Issued by ERA South Africa

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 17 Nov 2017
      FWJK has announced the launch of its latest residential brand, the Lil’ Apple, which will be launched simultaneously in two developments in Cape Town and Umhlanga totaling 600 apartments. The Lil’ Apple is set to be a brand of FWJK’s New York style apartments which will be rolled out nationally.
    • 17 Nov 2017
      It’s been a tumultuous year on many fronts, with socio-political uncertainty setting the tone for much of South Africa’s economic activity yet despite this and seemingly counter-intuitively, the residential property market has held up well.
    • 17 Nov 2017
      The EAAB (the Estate Agency Affairs Board) recently claimed that around 50,000 illegal estate agents could currently be operating illegally.
    • 16 Nov 2017
      Penthouses are synonymous with New York – characterised by high-rise living that is decidedly luxurious and spacious. While exclusivity comes at a price, you can still create a “penthouse” look and feel in your existing apartment or even the upstairs bedroom of a double storey house with some clever design changes and styling touches.
    • 16 Nov 2017
      The area has long been popular with kite surfers and, with escalating property prices in Cape Town itself, is increasingly in demand with home owners who work in town, but are looking to invest in more affordable properties.
    • 16 Nov 2017
      Cape Town’s popularity as a world-class tourist destination has resulted in a spike in the number of homes available for holiday lets and fuelled investor demand for sectional title units with short term rental potential.
    • 15 Nov 2017
      Sappi, one of South Africa’s oldest global companies and a leading global supplier of sustainable woodfibre products, has moved its global and regional headquarters to a new site on the corner of Oxford and 14th Avenue in Rosebank.
    • 15 Nov 2017
      There’s an old saying in real estate that you should seek to make a profit when you buy, not only when you sell – and a large part of succeeding at that endeavour is buying a home in an area with desirable features that will enhance the resale value of your property.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us