JOHANNESBURG – Power utility Eskom is seeking to recover R66.6 billion of costs incurred over the past three years through higher tariffs, saying it sold less electricity than forecast because of an economic downturn.
The parastatal, which supplies around 95 percent of South Africa’s electricity, is battling to stabilise its finances under new management after narrowly averting a liquidity crunch this year.
Eskom was at the heart of corruption scandals surrounding ousted President Jacob Zuma and is regularly cited by ratings agencies as a threat to the country’s creditworthiness.
Public hearings began on Monday on whether the National Energy Regulator of South Africa (Nersa) should allow Eskom to recover the R66.6 billion of costs through electricity tariff increases.
The power firm said it had spent more and earned less than Nersa had predicted when the regulator determined the path of electricity prices for the 2014/15, 2015/16 and 2016/17 financial years.
Eskom cited sluggish economic growth, commodity price changes and lower investor confidence over those years.
Eskom’s acting chief financial officer Calib Cassim said the electricity giant was aware it would probably only be able to recover the costs it had incurred gradually, if its application to Nersa was successful.
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Nersa is scheduled to make a ruling on the matter on 21 June.