NERSA, the National Energy Regulator of South Africa has handed ESKOM a 26% staggered annual price hike for the next 3 years instead of the requested 35% per annum (2010 - 24.8%; 2011- 25.8%; 2012 - 25.9%). See this post for how you're budget is affected. The very first request from ESKOM was 45% annually.
The ESKOM saga continues in South Africa. As I have said before here and here, the mismanagement at ESKOM and its governmental control has no end.
One of the mantras that ESKOM--and the government--continually repeats is that our electricity is the cheapest in the world. I never believed that for a moment. Not because I had facts to prove them wrong, but because we have all seen how open laagered and truthful untruthful this government and its corrupt cronies have been from the beginning. Their track record says it all!
Now, economist Mike Schussler said the claim of cheapest electricity is a lie! Schussler said that the research used by ESKOM and our government for the claim of cheapest electricity, used a "carefully selected group of industrial countries [...] rather than any developing countries."
He also said that out of a survey of 55 countries, 10 other countries had cheaper electricity than South Africa. Countries such as China, India and Russia.
Read the complete article here.
Blackmail! Something usually used by criminal groups such as the Mafia!
Dictionary.com defines it this way:black·mail [blak-meyl]
–noun
1. any payment extorted by intimidation, as by threats of injurious revelations or accusations.
2. the extortion of such payment: He confessed rather than suffer the dishonor of blackmail.
3. a tribute formerly exacted in the north of England and in Scotland by freebooting chiefs for protection from pillage.
–verb (used with object)
4. to extort money from (a person) by the use of threats.
5. to force or coerce into a particular action, statement, etc.: The strikers claimed they were blackmailed into signing the new contract.
As I have written in my previous post, ESKOM: The Illusion of Power, due to complete mismanagement and incompetence on the part of ESKOM (South Africa's ONLY electricity provider) and of the government, ESKOM had to approach NERSA (National Energy Regulator of South Africa) for a price hike of 53% instead of the 14% hike that was awarded to it.
Right on the heels of that shocker, Public Enterprises Minister Alec Erwin, said that if South Africans do not want to accept the 53% price hike this year, the South African public will have to take a 100% price increase in 2009! If that isn't blackmail, then I do not know what is! He is clearly giving us an ultimatum via a threat. He is clearly trying to coerce South Africans to roll over on the electricity price hike!
When the government, and its parastatals, treat its people in this way, it has become clear that they have overstayed their welcome. This saga will go down in infamy and names such as Alec Erwin's will forever be connected to it.
He further tries to bully us into accepting this price hike since it is so important for South Africa's hosting of the World Cup soccer tournament in 2010. This seems like emotional blackmail. It is sick! He knows that soccer in South Africa is big (even though our soccer team does not reflect that). In South Africa, soccer seems to be more about emotions than actual skill at times. Alec Erwin is clearly playing on this.
Further, ESKOM claims in its submission to NERSA for the 53% price increase, that these increases are necessary due to high increases in the cost of coal. I understand that if coal costs more for ESKOM to buy, then sometime or other they would have to pass those increases onto the public. However, it strikes me as truly odd that they are suddenly asking for all these price increases right after the load shedding started. Blaming coal prices is a ruse to hide their own incompetence in running the electricity provider.
Ten years ago, the management of ESKOM at the time warned the government that by 2007 South Africa would start running out of electricity if something was not done to remedy the problem. After all that time, they had done nothing to solve the crisis, and now the consumer has to pay up for their mismanagement and incompetence in running the energy supplier.
But, then again, this country has been run on injustice and subterfuge all along.
The injustice in this regard is that they want us to pay for their gross misconduct in running the energy problem in this country, and the subterfuge is that they are trying to hide the real reasons for the price increases behind so-called coal increases.
Our energy supply needs to be diversified urgently. One supplier for the country obviously is not the solution, and the consumer must be given a choice as to which supplier he wants to use.
I was not going to write about this issue. It simply is too depressing. It has become an analogy of the way this country is going!
Regression, back into the era of darkest Africa! The problem is, South Africa can hardly be spoken of as ever having been part of darkest Africa. Yet, here we are. South Africa is fast approaching that epithet at the speed of darkness.
It truly boggles the mind! True, in South African politics, and parastatals (such as Eskom), it doesn't take long for the next mind boggling trick up the sleeves of these institutions to be exposed.
Ten (10) years ago, the management of Eskom at the time warned the South African government of impending doom with regards to the country's power supply.
However, that little fact was only made known to the public a few months ago, after load shedding started being implemented in South Africa.
Once this episode started, and the government feigned an investigation into the load shedding by Eskom--government had known about this for 10 years already, remember?--the National Electricity Regulator of SA (Nersa) awarded Eskom a 14.2% price hike, effective from 1 April 2008.
Apart from this, Trevor Manuel, Finance Minister, announced in his budget speech in February, that the citizens of this country will be taxed on energy usage. Obviously, this is to make up for the billions of rands the government is "lending" Eskom to build its capacity up once again. So, it will be a 14.2% price hike, plus extra tax by the government on electricity!
But wait, it gets WAAYYY better!
Just a few days ago, it was brought to light that Eskom has asked for a 53% price hike! This hike will replace the 14.2% increase initially awarded.
First, those involved in allowing the situation to go this far and dumping this country into darkness should have been fired! Plain and simple! In any other company, if the top brass caused such chaos to ensue, they would have been fired, without apology! Yet, here in this Politically Correct Stupid country, these buffoons were probably apologised to for having thoughts of firing them! How absolutely ludicrous!
It is not just the management of Eskom that should have been canned! The Minister of Public Enterprise Surprises, Alec Irwin should also have been given the boot! So too the Minister of Minerals and Energy Atrophy, Ms Buyelwa Patience Sonjica.
Second, having run this country into darkness, the "fat cats" at Eskom are to receive performance bonuses to the amount of R9.22 Million at the end of March 2008. What would those bonuses have been if they actually ran a company that could provide the services they promised they could? R100 Million?
Are we to pay their bonuses for them?
It is absolutely sickening! The moral outrage! These evil men are going to receive millions, while at the same time they want South Africans to pay 53% more for their electricity! These monstrous "fat cats" are completely void of ethics! They should be taken to the wall and put before a firing squad! They do not deserve our mercy!
But, then again, God showed me mercy and so I will show them the same. Still, they should be fired! They should not be paid those bonuses. In fact, the bonuses that they were paid for the last 5 years should be demanded back by the company.
Third, Eskom management has proven by now that they are incapable of running Eskom successfully, and that they have truly messed it up, yet, they want the man in the street to pay for their mistake mismanagement!
Fourth, how dare Eskom ask South Africa for more money while they will continue to have these power cuts (load shedding)? Will Eskom's failures just never end? If I ask someone for more money, should I not first make sure that I can actually provide a good service to the client? Which client will pay for a service that is undeliverable?
Fifth, an electricity price hike will not happen in a vacuum! Almost everything will become more expensive overnight. However long that night will be while Eskom's rule of darkness continues! Once all these prices have gone up, our inflationary targets will not be met, since inflation will skyrocket, and then the Reserve Bank will increase interest rates. All of this will have a very negative effect on the country and will force our economy down into the doldrums.
What can I say, but, that there are dark days ahead of us?
I just wish government had the backbone to fire those responsible. Perhaps then our faith in justice will be restored.
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