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 />
Page 44 of 144<br />
However, <strong>Eskom</strong> did not have the mandate to include the additional build contemplated in<br />
IRP 2010 in its revenue application, other than the IPPs as referred to below. Moreover,<br />
Nersa could well not be in a position to make a decision regarding IRP 2010 capacity in the<br />
absence of policy certainty.<br />
<strong>Eskom</strong> acknowledged that referring to “build-up options” was misleading in that it did not<br />
adequately highlight the fact that these are not options but, in fact, necessary requirements<br />
to ensure security of supply. The company therefore revised its approach. The final<br />
application no longer refers to “build-up options” and clearly states that, even though the<br />
additional capacity of IRP 2010 capacity is not included in the revenue request, this<br />
additional capacity is nonetheless needed for future security of supply. The implications of<br />
such additional requirements on pricing, based on certain assumptions, have also been set<br />
out to help guide future decisions, as has been requested.<br />
Carbon tax<br />
As the carbon tax was still the subject of discussion and consultation, it was felt that it should<br />
not be included as a part of the revenue requirement. <strong>Eskom</strong> has agreed to this.<br />
Accelerated electrification<br />
<strong>Eskom</strong> indicated that additional steps were necessary to meet universal electrification<br />
targets within a reasonable time and suggested that consideration be given to funding these<br />
steps through the electricity tariff.<br />
Both Salga and the National Treasury supported the need for accelerated electrification but<br />
proposed that it continue to be funded through the national fiscus, and not by electricity<br />
consumers through <strong>Eskom</strong>‟s electricity tariff. <strong>Eskom</strong> has accepted this proposal.<br />
Funding of energy-efficiency and demand-side management programmes<br />
The proposed application included <strong>Eskom</strong>‟s energy-efficiency and demand-side<br />
management programmes in the revenue request.<br />
The National Treasury was of the view that energy efficiency and demand-side management<br />
should be funded through the fiscus via the electricity levy, and that <strong>Eskom</strong> and all other<br />
interested parties should apply to the revenue fund for these purposes.