Poor flee to bad buildings

JOBURG CBD: LANDLORDS TELL NERSA THAT ESKOM'S INCREASES ARE UNAFFORDABLE

- Antoinette Slabbert

If implemented, Eskom's proposed tariff increase of 36% will gobble up a huge portion of the income of poor families in the Joburg CBD, even though they don't buy directly from the utility.

Angela Rivers, general manager of the Johannesburg Property Owners and Managers Association (Jpoma), gave energy regulator Nersa an indication of just how unaffordable electricity will become for inner city dwellers.

Jpoma members jointly represent about 70,000 residential units in the Joburg CBD, with about 350,000 people living in them. Their investment in the area is altogether about R18 billion.

Rivers presented Jpoma's data at a Nersa public hearing on Eskom's tariff application at Gallagher Estate in Midrand last week.

Eskom has applied for the 36% increase next year, 11.8% the year thereafter, followed by 9% in 2027/28. If granted, its approved revenue in the three consecutive years will be R445 billion (up from R352 billion this year), R495 billion and R536 billion.

Criticism The utility has been widely criticised for its effort to raise its tariffs by several multiples of the inflation rate, which was only 2.8% in the 12 months to the end of October.

Rivers told Nersa that their electricity bill will represent almost 60% of the monthly expenses of poor people living in the Joburg CBD next year, should Eskom get the green light from the regulator. For those on prepaid it will be 44%.