PRICE SHOCK

4th February 2022 By: Darlene Creamer

PRICE SHOCK

As expected, none of the non-Eskom stakeholders who made oral representations to the energy regulator on Eskom’s request for a 20.5% increase had any sympathy for such a hike. Doubly so given the context of a weak economic outlook, rising unemployment and deepening poverty. That said, many of the utility’s costs are pass-through expenses, while those within its control are under genuine upward pressure, even if there are still many questions about efficiencies at the utility. So, while a high double-digit shock would be too much for South Africans to bear, the regulator also has limited room to manoeuvre.