Eskom plans to use tariffs to encourage power conservation


South African utility Eskom has announced plans to use punitive tariffs to force large consumers to conserve electricity Faced with increased demand for power, ageing infrastructure and not enough power plants, the utility has resorted to load shedding to manage available resources. In addition it has applied to the regulator NERSA (National Energy Regulator of South Africa) for permission to increase tariffs by 53 percent. The utility recognises, however, that this hike will impact negatively on poorer consumers, and is therefore suggesting a quota system. Users that consume more than their quota could be charged up to 100 percent more for their electricity if the suggestion is adopted, and wealthier consumers will incur a higher percentage increase than poorer consumers.

The impact on existing metering and billing systems is recognised, and practical problems will have to be solved before the new system is implemented. South Africa makes extensive use of prepayment meters, but their use is not restricted to low income earners, which makes tariff setting more complicated.