Eskom tariffs increased by 300% in last 10 years, says expert

Date: Mar 4, 2019

South Africa has reached a point where electricity generated from new wind and solar power plants is 200% cheaper than electricity generated by Eskom’s Medupi and Kusile coal powered plants.

This is according to Jesse Burton from UCT’s Energy Research Centre, who told delegates at a symposium on a just transition away from coal that the two coal plants still under construction had bankrupted Eskom and put all those who depended on the utility at risk.

Electricity tariffs had increased by 300% in the last 10 years.

The National Energy Regulator of SA (Nersa) is expected to make an announcement on Thursday in relation to tarriffs.

“The debt trap caused by Medupi and Kusile has led to a crisis at Eskom. Tariff increases have closed other mines and factories all over the country. In this context, South Africa needs a just transition that protects fossil fuel workers from a disorderly transition away from coal,” she said.

Burton, who organised the symposium in Cape Town on Wednesday with several international partners, said the country needed a new development pathway in which labour intensive sectors could grow and build a more resilient economy and inclusive society.

“Eskom, the coal sector, and environmental and social justice have become one of the most important themes in South Africa today.”

There was consensus among delegates that the global demand for coal was shrinking, and that demand was likely to decline further in the 2020s. This was the result of several factors, particularly the rapid drop in the global price of wind and solar power, which made coal power uncompetitive.

Oliver Sartor of the Institute for Sustainable Development and International Relations in France said in addition several major economies were reducing coal because of climate policies, while China was capping coal plants because of extensive air, soil and water pollution and the massive impact on human health.

Alvin Lin from the Natural Resources Defense Council in the US said estimates were that air pollution in China had caused between 400 000 to 700 000 premature deaths. This had led China to develop an Air Pollution Action Plan in 2013 that set coal reduction targets.

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