Business Day Live 24 October 2012.
ONE of the many unpleasant messages in Eskom’s tariff application to the National Energy Regulator of South Africa (Nersa) is that electricity users will have to bear the brunt of the switch to private sector power.
The new multiyear price determination (MYPD) differs from the previous one in many ways. For instance, in the five years covered by the determination, South Africa will, for the first time, introduce thousands of kilowatt hours of electricity capacity from private sector producers. This will be bought at levels higher than Eskom prices…
(Editor’s note: Electricity users to pay for their electricity? That makes sense, who else should pay for it? The general tax payers? Far better for the users of a service to pay for the service. A better question I think is whether it is right to spend money on renewable energy rather than coal or nuclear plants, and would coal or nuclear be cheaper? This is where things get more complicated and more emotional. We have to answer questions such as: how do we put a value on harmful emissions, on environmental damage and on climate change. Will a global tax on carbon come into being and how much will this be?What is the price of coal going to do in the future? Are nuclear power plants safe and if not what cost do we put on the risk? In the end I think it comes down to doing what is right and continuing to mess up our planet to satisfy our energy needs is patently wrong, regardless of the economics. In any event, it looks like the economics are swinging in favour of renewable energy. It would be interesting to see the levelised costs of electricity from renewable sources compared to the levelised costs of Medupi and Kusile. )