Eskom has approached the National Energy Regulator of SA (Nersa) for a 60% hike in electricity tarrifs, this will replace the increase of 14.2% that has already been granted. Eskom cites increased coal prices and demand side management issues.
The request comes after statements by SA President Thabo Mbeki that the era of cheap electricity was over, there is little indication as to whether Nersa would grant the request. An increase of this magnitude would definitely have a huge inflationary effect although one positive consequence would be that consumers would change their consumption patterns quite rapidly.
Industrial users would not be impacted as they already have long term contracts in place and the major impact will be felt by residential and commercial consumers.