Part 1 Revenue Application: Multi-Year Price Determination ... - Eskom
Part 1 Revenue Application: Multi-Year Price Determination ... - Eskom
Part 1 Revenue Application: Multi-Year Price Determination ... - Eskom
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Overview of <strong>Multi</strong>-<strong>Year</strong> <strong>Price</strong> <strong>Determination</strong><br />
2013/14–2017/18 (MYPD 3)<br />
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additional build projects that are required or might be allocated to <strong>Eskom</strong> in terms of IRP<br />
2010.<br />
Assumption 2: IPPs to be included<br />
The application includes IPPs, which have already been contracted through short-term<br />
energy purchases and the Medium Term Power Purchase Programme (MTPPP), the DoE‟s<br />
peaker plants of 1020MW comprising of two open cycle gas turbine (OCGT) plants planned<br />
to be constructed at Dedisa (near Port Elizabeth) and Avon (near Durban), and the<br />
renewable energy IPP bid programme, which caters for a total of 3 725MW of renewable<br />
capacity, pursuant to the determination by the Minister of Energy is also included. The<br />
assumptions for the renewable costs and energy were based on information provided by<br />
Department of Energy (DoE).<br />
Assumption 3: Single-digit increases for primary energy costs<br />
Primary energy increases will decline to single-digit percentages over the MYPD 3 period as<br />
major coal producers support the stakeholder pact.<br />
A stakeholder pact to ensure a sustainable electricity industry<br />
<strong>Eskom</strong> believes South Africa needs a stakeholder pact to curb electricity demand and limit<br />
increases in primary energy costs. Such a pact, as advocated by the President and the<br />
Minister of Public Enterprises, would help <strong>Eskom</strong> to contain operating costs and remain a<br />
sustainable entity over the long term. The pact would include:<br />
A clear path to cost-reflective prices.<br />
Measures such as the ECS to reduce electricity demand, particularly from large<br />
industrial customers.<br />
Single-digit increases in the price of coal over the medium term.<br />
Such a pact would effectively ask South Africa to partner with <strong>Eskom</strong> and contribute to<br />
achieving the goals of economic growth through ensuring security of supply. Implementing<br />
such an agreement would require extensive public consultation and negotiation with major<br />
customers.