Energy regulator Nersa has made big adjustments to Eskom’s application to recover billions of rands in lost revenue from South Africans. But the balance is still in its favour.
The national energy regulator Nersa has wiped almost R16 billion off Eskom’s application to claw back lost revenue—but R8 billion was still approved, which will result in future price hikes for South Africans.
The RCA is an account in South Africa’s current electricity tariff methodology that contains a balance between the actuals for Eskom’s full financial year and what was allowed by Nersa for that year. However, given Eskom’s dire financial and operational performance, the RCA has always favoured the power utility, and the RCA has led to Eskom applying for increasingly higher tariff hikes each year.
The R9 million it is seeking is less than 2% of Eskom’s allowable revenue for the year and the lowest application it has ever submitted.The RCA is a highly controversial aspect of the tariff methodology in South Africa. The courts found this unlawful and ordered the regulator to add this back in—starting with R23 billion in 2021/2022, and the balance in RCAs for 2022/23 and 2023/24.
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