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 />
No dividend payments to shareholder will occur to 2030.<br />
Page 32 of 144<br />
Operating costs beyond the MYPD3 period escalate by an average of 6% per<br />
annum.<br />
Coal price increase by an average of 10% per annum after 2017/18.<br />
65% build vs 100% build<br />
The difference between what <strong>Eskom</strong> builds beyond the MYPD 3 period in the 100% scenario<br />
when compared to the 65%scenario is only 2,700MWs. Hence the financial impact is<br />
insignificant and the results are similar for both scenarios. The key results are summarised<br />
below.<br />
Scenario 1: <strong>Eskom</strong> builds 65% of capacity post MYPD3<br />
To achieve the 65% target, the electricity price would need to increase by 20% a year for the<br />
five years of MYPD 3, as shown in Figure 2 and five further years of 9% p.a. before<br />
inflationary adjustments p.a. are reached. The extended projected price path for electricity<br />
would be lower than the IRP 2010 price path, with the price reaching 102c/kWh in real terms<br />
in 2030/31 compared to the 110c/kWh in the IRP 2010.<br />
c/kWh<br />
300<br />
250<br />
200<br />
150<br />
100<br />
50<br />
0<br />
10/11<br />
25% 26%<br />
16%<br />
20% 20% 20% 20% 20%<br />
9% 9% 9% 9% 9%<br />
4% 6%<br />
-8%<br />
MYPD 2 MYPD 3 MYPD 4 MYPD 5 & BEYOND<br />
11/12<br />
12/13<br />
13/14<br />
14/15<br />
15/16<br />
16/17<br />
TARIFF IMPLICATIONS<br />
Figure 2: <strong>Revenue</strong> requirements for IRP 2010- 65% scenario<br />
17/18<br />
18/19<br />
19/20<br />
20/21<br />
21/22<br />
-1%<br />
6% 5% 5% 4%<br />
Nominal price % increase (RHS) Nominal standard tariff - c/kWh (LHS)<br />
Real standard tariff - c/kWh (LHS) IRP 2010 - real c/kWh (LHS)<br />
22/23<br />
23/24<br />
24/25<br />
25/26<br />
26/27<br />
27/28<br />
28/29<br />
29/30<br />
30/31<br />
30%<br />
25%<br />
20%<br />
15%<br />
10%<br />
5%<br />
0%<br />
-5%<br />
-10%<br />
-15%<br />
Nominal % increase