IS 8% REALLY ANY BETTER? - Why South African's should not be thanking Nersa!

Pietermaritzburg, KwaZulu Natal, 28 February 2013 – Despite the National Energy Regulator of South Africa (Nersa) today announcing that it would halve Eskom's proposed tariff hike application for the third round of the Multi-Year Price Determination (MYPD3) to 8%, it is clear that this is no fair compromise.

Large energy users continue to receive subsidies for cheap electricity from Eskom [1], while ordinary South Africans foot the bill. This has a particularly negative impact on the poor who are often forced to either live without electricity or to burn various fossil fuels that have detrimental impacts on people's health.

Director of environmental justice organization groundWork [2], Bobby Peek:
"Eskom is in deep financial trouble and is pulling the country into trouble. Its subordination to elite corporate interests has led to poor management decisions in defense of an energy regime which is not sustainable in economic, social or environmental terms. Its continues reliance on coal, is sabotaging South Africa, and world's future as peoples' health continues to be impacted upon by coal mining, burning and climate change."

Eskom has been awarded extraordinary tariff increases – tripling the price over the last five years – to pay for its big new coal-fired power stations, Medupi and Kusile. These plants are primarily designed to provide power to big energy intensive industries and they will add significantly to South Africa's already heavy carbon load. The switch to clean and affordable electricity in the form of renewable energy sources is seemingly not a priority on Eskom's list.

Siziwe Khanyile, groundWork's Climate and Energy Campaigner, has this week with international organization Gender Action [3] hosted a workshop training communities in Lephalale to better understand and mitigate the gender impacts that Eskom's World Bank-funded Medupi power station will cause. She commented on Nersa's announcement:
"Increased electricity costs impact women in that they bear the burden of finding alternatives to electricity and resort to burning wood or coal inside the home which affects women and their families' health".

The Integrated Resource Plan (2010) [4] should have acted as a stronger point of guidance from which Nersa acted. Nersa should have been bold enough to demand that Eskom changes its production and delivery strategy for energy. A strategy that serves peoples basic needs, basic services, encourages decent and meaningful jobs – rather than extractive industries and polluting smelters – and secured an environment that is not harmful to live in.

At the time this statement was issued, a document of Nersa's detailed decision had not yet been made available via the internet or any other medium. groundWork will issue another statement after this document is made available.

FOOTNOTES:
[1] "Energy intensive users still to profit despite Eskom's tariff hikes" - press release issued by groundWork on 17 January 2013
[2] groundWork is an environmental justice organisation working with community people from around South Africa, and increasingly Southern Africa, on environmental justice and human rights issues focusing on Air Quality, Climate and Energy Justice, Waste and Environmental Health. groundWork is the South African member of Friends of the Earth International.
[3] Gender Action is the only organization dedicated to promoting gender justice and women's rights in all International Financial Institution (IFI) investments such as those of the World Bank and the International Monetary Fund. Gender Action's goal is to ensure that women and men equally participate in and benefit from all IFI investments http://www.genderaction.org/
[4] See the IRP (2010) document:
http://www.energy.gov.za/IRP/irp%20files/IRP2010_2030_Final_Report_20110325.pdf

CONTACTS:
Megan Lewis, Media, Information and Publications Campaigner at groundWork at +27 (0) 33 342 5662 or +27 (0) 83 450 5541 or megan@groundwork.org.za

Bobby Peek, Director at groundWork at +27 (0) 82 464 1383 / bobby@groundwork.org.za

Siziwe Khanyile, Climate and Energy Justice Campaigner at groundWork at (033) 342 5662 or +27 (0) 73 830 8179 or siziwe@groundwork.org.za