By Rachel Mohamed
President Cyril Ramaphosa has signed into law the Electricity Regulator Amendment Bill which sets out far-reaching reforms for the country’s energy sector. This includes establishing a ‘competitive’ electricity market and hopefully reduced energy costs.
Speaking on VOC’s News Beat show on Monday Chairman of the Electricity Resellers Association of South Africa Johan Hopley described the amendment bill as a “new dawn in South Africa as it has opened the electricity market to private entity making it more competitive for the entity to compete in the market,” he said.
“Looking at the price of energy it has gone up by about 100% in the last five years and another 40% will make it impossible for consumers to pay for electricity.”
However, he cautioned that the process would take another five years to get the full system to operate.
Hopley further stated that with Eskom owning the network currently connected to all the municipalities, this process opens another connection to municipalities via a private entity to supply them with electricity.
He further highlighted that Eskom has certain infrastructure that supplies electricity and companies are not going to reinvent the wheel to put a new infrastructure as it already exists.
“If you look at the unbundling of Eskom it used to be a generation, transmission of energy, and deliveries are going to play a fundamental role in those three entities,” he commented.
Hopley said that he has compiled an extensive research study into the energy sector in the last four years and has seen a “40% decrease in consumption in residential consumers throughout the country.”
The study found that the cost of electricity has increased every year, and it will be unaffordable to have electricity 24 hours a day. He added that further increases would overburden the consumer and make people use less electricity as it would be catastrophic for South Africans to pay 40% more tariff for their energy consumption come next year.
With the rise in electricity costs, Johan hinted at the fact that there might be social unrest in the country as people can no longer afford anymore, and if you look at the electricity prices in the last five years the total income of the household is reducing drastically every year and at the end is either level out electricity or people will take to the streets and protest against it.
“There will be a time in the future when Eskom must make electricity cheaper just to sell it and that is why the time of use tariff has always been fundamental in that if you make electricity much cheaper at times of the day it will encourage people to use it but through the board expensive will discourage people to use it,” he concluded.
VOC News
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