Factories ‘should get cheaper electricity’

Business Day Live 4 December 2012.

MANUFACTURING companies should get lower electricity price increases linked to the rate of inflation, Department of Trade and Industry director-general Lionel October said on Monday.

He told a panel discussion hosted by the department there must be exemptions in electricity prices for the embattled manufacturing sector. “We’ve moved from being the cheapest electricity producer to the most expensive,” he said.

“There must be an exemption for manufacturing for at least inflation-linked price increases,” he said. The current inflation rate is 5.6%.

Power utility Eskom has asked the National Energy Regulator of South Africa to give the go-ahead for tariff hikes of 16% over each of the next five years. That process is now open for consultation.

Meanwhile, Business Unity South Africa (Busa), a lobby for big business, said it believed the requested average tariff for Eskom’s multiyear price determination could be as low as 10.8% and still reflect costs…

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