SA could have world's most expensive power

To really compare apples with apples, we need to know how many hours the average consumer of electricity would need to work in South Africa to pay for one KW of electricity vs how many hours a (eg.) US citizen needs to work for the same. Is our electricity as cheap as Eskom says it is RIGHT NOW, when worked out in the REAL TERMS that we pay for it?

Mike you are a good guy. Tell it like it is. We are tired of being lied to. Cheapest electricity is a big lie.

As long as we get households to subsidise smelters and other heavy electricity users (KSACS), the poor households will never stop suffering. Let KSACS pay realistic electricity tariffs and there will be peace in the valley.

Where is our investment in our abundant renewable energy? Wind farms in the western and eastern cape, ocean current electricity generators along our entire coastline, solar energy throughout the country etc!

One can not but think that the development of renewable energy is bad for business, for the coal mines, transport tenders, procurement of contractors to build power stations, kickbacks, etc.

Pete you are correct. We need the energy equivalent of the Big Mac Index.

Mike is perhaps a bit generous in his figures. My fear is that the economy is set to contract when the 2010 Fifastan effect wears off and we return to normal infrastructure development.

Any hope that the reduction will be offset by Joe and Jessie Soap increasing their discretionary spending is killed stone dead by Eskom.

At least this is attacking the mantra that coal = cheap energy. With Eskom failing to deliver more capacity, SA could do a lot worse than to go on a major efficiency drive. Thousands of jobs could be created making buildings better insulated for example. Whatever we do, energy has to get more expensive. The worldwide trend to put a price on carbon is just a start. The myth that there's plenty of coal is based on the assumption that demand won't increase.

Some details here: http://opinion-nation.blogspot.com/2009/01/forget-climate-change-fossil-fuel.html

On a related point,the increases are likely to be significantly higher for users of Municipal Electricity.

For example if the Municipality pay Eskom 33c per KwH and charge consumers 66c per KwH, and Eskom impose a 33% increase, the increase to the consumer should be 11c. Experience in Durban and East London shows that the increase will be closer to 22c per KwH, a cash windfall for the Municipality.

Again this is why I feel Mike Schussler's figures are a bit optomistic.

I suspect the key to the huge increases is Eksdom's costs. I guess turbine orders were placed at top dollar during a world boom and had to carry the ANC's (and a few cadres no doubt) parasitic financial load. Then of course you have hugely costly open cycle turbines, incompetent repair and maintenace, huge cost de-mothballing old stations in record time. All run by incompetent or corrupt management. Costs will balloon; a bit like that defence saga actually.

all the moola that we've spent on those huge stadiums, for that brief two weeks of leisure coming round next year...we should have invested in sustainable energy (maybe a solar geyser in exchange for your old school one, free!) Or wind-farms, solar generate etc. Eskom should be overhauled to find the mysterious bolt...

My bill from Escum this month was R1900.00, no heaters, no baths, just showers and we cook on gas, we are now averaging R1500 a month, we have fought Escum on this for months and they don't care they say if we don't pay we get cut off, and R750 for a reconnection fee! I fear what my bill will be with the increases.

We are looking at an old Lister generator and the solar option to cut these robbers out of the equation.

I agree,

Renewable energy is the way to go. Lets raise our voices against unnecessarily costly (and probably unjustified) electricity price hikes and invest in renewables. Lets DO IT AT HOME. Investigate solar panels. It makes sense on so many levels.

This absolutley pisses me off. This was due mainly to unblievably ineffective and corrupt management. I cannot believe the numbers and the % increases being touted. How the hell are the few people actually paying electricty going to afford this. I am already stuggling to keep up with all the fcuken increases. Screw these dickwads, operational jets for the police etc etc when will the masses finally see this for what it really is. Daylight bloody robbery. Bastards.

I don't think you have a choice but to become as self sufficient as possible. Every thing the ANC touches goes rotten ... I don't have to list them here, just watch the daily headlines but the list certainly includes municipal costs and services, health, safety/security, energy, education etc etc.

Soon to be joined by water - this is going to be the biggest nightmare we will face!

So, survival and affordability depend on finding alternatives and becoming self sufficient.

Now, if I can only find a tame quack before the National Health programme kicks in ....

Hey, I have a great business idea. Install solar panels and sell the electricity back to ESKOM. At these prices you'll get rich quick. But seriously, with the amount of sunlight available in SA this should be a no-brainer...

Eskom makes me with the opposition were in power.

SOLAR FACT:
It cost more electricity to produce a solar panel – than what the solar panel gives back!
Solar technology is not yet a win-win option.

LOOK AT:
Wind – farms but very high maintenance cost
Wave energy – also high maintenance (need much more researched…)
Nuclear – can become in the next decade and a ½ the best answer…

WHILE WE DO RESEARCHE AND TEST ON NEW WAYS OF ELECTRICITY:
ESKOM should start doing maintenance on existing infrastructure.
40% of ESKOM electricity are stolen – from the TOP – make an example start pay your bills…

E.g. Why should I pay my electricity bill (or not have an illegal connection) if the MINISTERS can stay in 5 Star HOTELS, if the MINISTER spend big money on parties, if they spend a lot of money on personal PROTECTION --- using the tax-payers money … WHY MUST I PAY MY ELECTRISITY ...

Come President ZUMA show us YOU (and your MINISTER) will be responsible then we will start pay our electricity!!!

Mike, can you back up your facts please? I refer to the NUS consulting report which is reputable and well researched. Their June 2009 survey http://www.nusconsulting.com/files/2009_Int_EGSurvey.pdf clearly has SA as the cheapest electricity in the world (actually around 50% of the US, see page 4). You may be correct about household energy, but average electricity is still the cheapest when you consider business as well. This is frankly bad journalism, misleading and creating unnecessary noise.

The SA public should wake up to the fact that the holiday is over. Eskom/govt have created a massive problem which we all have to live with but no amount of whinging will change that. Higher energy rates are inevitable. Energy efficiency is paramount.

Nuclear energy is the answer, or shall I say was. Unfortunately the PBMR (pebble bed modular reactor) which initially was a South African company, no longer belongs to South Africans. Foreign investors are picking the fruit from all our crumbling parastatals and major techno companies. That's because the skills are immigrating.

South Africa is becoming more and more of a joke every day. 1% growth!? That is laughable... and pretty tragic.

South Korea provides an excellent example of what a nation can do to bring itself out of complete third-world conditions into high-tech first world ones with only good governance and a can-do attitude. They averaged about 10% growth between 1970 and 1995! We're barely scraping together a percentage point.

Pathetic! These are all the stats the average voter needs to see. That is outright failure of government.

http://www.google.com/publicdata?ds=wb-wdi&met=ny_gdp_mktp_cd&idim=country:KOR&q=south+korea+gdp+chart

Sipho Hu, nice comment dude.

Don't forget about waste to energy, when talking alternative energy.
Millions of tons of the waste that is dumped in landfill sites can be converted to to gas, which in turn can be used to generate electricity.
Europe and the USA are making massive inroads in this area, but in South Africa it is barely looked at.

The cost per kilowatt/hour in the USA (hawaii) is about USD 0.30, which is one of the highest in the USA. This would be about RAND 2.2 at current ex rates. What are RSA people paying?

I don't think the economists have thought out the full ramifications of the proposed increases. Say, for example, 70% of the input cost of gas is electricity and the price is going to triple. How many companies that depend critically on gas as an input are going to survive? What happens to their customers if a key input into their operations disappears?

Co-firing boilers with waste is theoretically a good idea, but there is a lot of work which needs to be done before it becomes a viable option in SA. In the long term it would work, but to solve the current power crisis it is cheapest to stick to what we know and build coal fired plant.

Instead of the 45-45-45 system, we prefer the 4-4-2 system like in football !
Seriously though, next winter many people who can't afford this will have to freeze without heaters.

I agree there should be something like a Big Mac index. I recently saw prices in Australia - quite high after increases there too, and realised that, taking wages into account, if you earn around R200K, or less (the MAJORITY), electricity is expensive.
Renewable is the way to go, definitely.

This shows how hideously inefficient and wasteful our energy generation is. South Africa pollutes more per kilowatt of energy produced than almost any other country - and the only possible justification for using such a filthy and archaic fuel as coal is that it's at least supposed to generate electricity cheaply. If we can't even do that, then why the hell aren't we pioneering the clean energy revolution?

Energy prices do need to increase, as they've been kept artificially low. But that should be coupled with massive efficiency drives or it's just money down the drain

The Buffoons at Eskom overpay by a factor of 300% vs World Bank Stds for power stations, overpay for crappy coal & stones on short term contracts with their buddies where half the cash goes into someone's pocket at Eskom, over staff themselves with persons of dubious qualifications and no experience, and then want to pass the cost onto us. They must have rocks in their heads.

We want enquiry now!

http://www.gopetition.com/petitions/stop-eskom-extortion-now.html

Please help asap!

For business, the implications are the unwnding of the long-term spot-price related contracts. We have already seen the proposed smelter at Algoa Bay cancelled because of worries over the cost of power. We do this wrong, Richards Bay can go back to being a small fishing village.

As I stated above, the main issue for domestic consumers in areas where the Municipality reticulates power is that the increases are likley to be far higher than the increases quoted by Eskom. The Municipalities are going to apply the percentage rate to the full tariff or close to it rather than just the Eskom portion.

This edals another body blow to the optomoists who think that retail is going to be saved by Joe and Jessie increasng their discretionary spending. They have precious little now, and what is left will be used to pay Eskom and the Municipalities.

The price for domestic consumption in Hawaii for August 2009 was 25.13 cents US. (R1.88)
The average price for the US was for that same month 12.05 cents US (90.4 cents ZAR)
Couple that with the much lower income in SA and it can be said that even now we pay trough our noses. (Especially with our masses of dirt-cheap low grade coal)
When our current price will be tripled, (after three 45%) we’ll be creamed, totally ripped off, milked dry into poverty and economic stagnancy.
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