Eskom faces grilling about efficiency of its operations

Key to whether Eskom will be granted the amount, claimed under the regulatory clearing account, is whether it operated its assets and coal supplies efficiently Picture: REUTERS

Eskom’s efforts on Monday to justify its claim for the recognition of an additional R27.2bn by the country’s energy regulator was met with scepticism.

BusinessLIVE reported that if Eskom is successful, this will result in higher electricity tariff increases in future. It wants to be able to claw back this amount over the next two years.

Key to whether Eskom will be granted the amount, claimed under the regulatory clearing account, is whether it operated its assets and its coal supplies efficiently. It appeared from questions asked by National Energy Regulator of SA (Nersa) regulators at a public hearing in Cape Town that they had doubts about that.

If Eskom was found to be inefficient, Nersa would have to reject all or part of its claim.

The regulatory clearing account is a backward-looking reconciliation. It is a monitoring and tracking mechanism that compares uncontrollable costs and revenues assumed in the multiyear price determination for Eskom with costs and revenues incurred by the power producer.

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