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Thursday, April 24, 2008

Press Release: Resistance Against Unfair Tariff Hikes Grows

I'll post some pictures soon (I hope).


Press Release: Resistance Against Unfair Tariff Hikes Grows
Earthlife Africa Jhb, Anti-Privitisation Forum
21st of April 2008

On the 23rd of April 2008, approximately 2,000 members of the Anti-Privitisation Forum (APF), Earthlife Africa Jhb (ELA Jhb), the Landless People's Movement and The Greenhouse will be hitting the streets in Johannesburg to protest against Eskom’s proposed and unjust tariff hikes.

The march will begin at Library Gardens at 10am, moving to City Power (Jorrisen Street) and then to Eskom (Smit Street). In addition to this protest in Johannesburg, protests will take place in Pretoria (to DME and NERSA), Durban and Cape Town on the same day.

These events will be preceded by pickets on Tuesday (22nd of April) in Pretoria (DME & NERSA), in Johannesburg (Eskom & DME) and the Vaal (Eskom). All of these pickets will commence at 10:00am, please contact APF Organiser, Silmuko Radebe (see below) for more information.

The proposed tariff hikes of 60% in real terms will negatively affect the living standards of poor households and will be at odds with efforts towards poverty reduction. Eskom will be placing a burden on consumers who cannot already afford electricity. Despite the Government and Eskom’s repeated boasts about electrification, 30% of South Africans are still without electricity. Of the 70% who do have electricity, many poor users suffer from disconnection. Furthermore, users of prepaid meters disconnect themselves (due to lack of funds to feed the meter), thus transferring the onus of disconnection from the state to the citizenry. The Free Basic Allocation of 50kWh a month per household is widely regarded to be inadequate; 50kWh doesn’t stretch that far between six to eight people.

APF Organiser, Silumko Radebe, states that, “The restructuring and preparation for the privatisation of ESKOM has led to the present crisis. Following the dictates of GEAR and ASGISA and the Washington consensus that gave birth to the neoliberal policies, the energy sector was opened to foreign investments through privatisation and deregulation. The motivation for restructuring Eskom was that there is a need to introduce competition into electricity provision. Eskom was, therefore, broken up into its generation, transmission and distribution divisions and corporatised. The current crisis is borne of these efforts to create a power market where scarcity of energy resources ensures a ‘competitive environment’ and profitability for the generators and distributors of electricity. The restructuring of the distribution division set up regional electricity distributors (REDs) that would be financially and organisationally independent of one another and the state. In other words, electricity is treated as a commodity rather than a public service.”

A social ill will only be increased by the proposed tariff structure. In response to rising electricity prices, many poor consumers will turn towards alternative energy sources such as paraffin, coal, and biomass. This will have enormous financial and social consequences: For example, in 2000, there were 46,000 paraffin fires, 50,000 paraffin burns, and at least 4,000 children died from drinking paraffin. The total cost to the economy of paraffin related incidents is R100 billion a year. Our children are being physically scarred for life or are dying because Eskom refuses to supply adequate electricity to its poorest and most marginalized citizens.

This move of Eskom’s is surprising and foolhardy. There exists a set of reforms, which if implemented, can alleviate the power crisis and the lack of access crisis that besets this country. They are:

1) A step-block tariff with a free basic allocation of 100kWh per person per month.
2) The opening up of Eskom’s secret contracts with large-scale users and tariff increases on the 25 companies that consumer 40% of our electricity generated.
3) The scrapping of subsidised electricity for foreign corporations under the Developmental Electricity Pricing Programme, and, in particular, the Alcan contract.
4) The abolishment of pre-paid metres.
5) The reorganisation of Eskom within the state so that it operates as an agent of social construction and not a profit-making business.
6) Investment in renewable energy instead of the costly fossil fuels of coal and uranium.
7) No member of Eskom management shall be paid a bonus.

Tristen Taylor, Earthlife Africa Johannesburg’s Energy Policy Officer, states, “As much as electricity tariffs needs increase to address infrastructure maintenance needs, the proposal from Eskom is either vague or at odds with endeavors for poverty eradication. It is of utmost importance that Eskom addresses the issue of indigent users access and affordability of electricity supply and unless Eskom adequately addresses its electricity-generation strategy that is at the heart of its long-term financial ill health, Eskom’s proposals should be rejected by NERSA.”


For more information, please contact:

Tristen Taylor
Energy Policy Officer
Earthlife Africa-Johannesburg Branch
Email: contrarytoauthority@gmail.com

Silumko Radebe
Organiser
Anti-Privatisation Forum
Email: khethokuhle@gmail.com

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