high power bills coming
Expect the price of electricity to soar in the next five years, and things won't look much better in the years after that.
We have been paying the world's lowest prices for power, but new generating stations will force consumers to dig much deeper into their pockets, Finance Minister Trevor Manuel pointed out in his Budget speech on Wednesday.
Eskom's finance director Bongani Nqwababa yesterday spelt out exactly how much pain consumers will have to endure. The utility's old plants generate power for between 21c and 22c a kilowatt. The cost of building enough new plants to satisfy South Africa's insatiable demand will come in at 40c a kilowatt-hour, he said.
A kilowatt-hour is the amount of electricity a 100W bulb consumes in 10 years, or what a small one-bar electric heater or iron burns in an hour.
The power that Eskom generates at about 22c an hour costs most homeowners far more, because it must be transmitted to municipalities who bump up the price when they distribute it to consumers.
In Johannesburg, an average household can expect to pay City Power about 37c a kilowatt-hour.
Expect your bills to double or more within five years and to carry on rising as the years go on. Eskom will be spending almost R350billion on infrastructure in the next five years and R1trillion by 2025 as it brings new nuclear plants online, chief executive Jacob Maroga saidyesterday.
Though supply remains tight, the company has been able to avoid load shedding for the past few weeks. And it will continue to preach the message of saving electricity for the next decade as it brings new coal-fired and nuclear stations on line.
The utility does not expect to be out of the woods before 2016, when the first of the new nuclear-powered generating stations starts pumping power to Eskom's national grid.
Manuel hopped on the conservation bandwagon yesterday by announcing a 2c tax on each kilowatt-hour we consume.