As the first of NERSA’s (National Energy Regulator of South Africa) public hearings goes ahead in Cape Town today, the Nelson Mandela Bay Business Chamber is gearing up to put forward the business case against Eskom’s proposed electricity tariff increase in Port Elizabeth on 16 January 2013. Eskom is proposing a 16% increase every year for the next five years to fund its build programmes, which, the Chamber believes, will have a catastrophic effect on business in South Africa.
Wednesday 16 January 2013 will see Angus Clark, head of the Business Chamber’s Strategic Resources task team, present an objection on behalf of organized business in the Nelson Mandela Metro. “The proposed increase will have a significant adverse economic impact to the continued survival of the manufacturing industry and commercial sector,” says Kevin Hustler, CEO of the Nelson Mandela Bay Business Chamber. “The Chamber is standing firm on this issue to avoid potentially devastating consequences for business and domestic consumers alike.”
The proposed increases will have a direct impact on all energy consuming businesses.
“The bills will only continue to rise as municipalities add on a percentage to the base amount as income,” says Hustler. “Electricity tariffs are quickly reaching their tipping point. Domestic consumers have to dig ever deeper into their emptying pockets, and businesses face the harsh reality of closing up shop.”
Business in the region will face severe implications should the proposed increase in electricity tariff be implemented. “As the cost of doing business in South Africa rises, we will see a concomitant reduction in investment into the country,” says Hustler, “and a lack of competitiveness will see South Africa lose footing in the global arena. The negative knock-on effect on the economy will affect all communities, but especially the poor.” Hustler warned that a severe reduction in the competitiveness of South Africa would take a heavy toll on the Eastern Cape region in particular, putting future business and investment into the Nelson Mandela Bay region in jeopardy.