"Electricity production by Eskom, consumption and distribution to provinces declined by 7.2 percent, 5.5 percent and 7.4 percent respectively for the first quarter of 2009, compared to the first quarter of 2008," Cosatu’s Industrial Policy Coordinator Jonas Mosia told public hearings into the application.

This, coupled with a bleak economic outlook should prompt the regulator to reject the application, he said in a submission at the hearings, being conducted in Pretoria by the National Energy Regulator of South Africa (Nersa).

"Over 208 000 jobs have been lost due to the financial crisis. Poor households would bear the burden of high electricity tariffs," he said.

Research into high electricity prices in countries such as Ghana showed the danger of steep increases.

High prices could lead to a "vicious cycle" where people defaulted on their payments, were disconnected and resorted to illegal reconnections.

Mosia said Eskom’s application was an interim one and suggested that Nersa wait until September to consider an increase.

Eskom has indicated that it intends putting in place a funding model in September.

After Mosia’s short presentation, Nersa adjourned the hearings. They are set to continue on Tuesday.

Sapa

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