KZN business chambers say enterprises won’t survive if the proposed 40% electricity increase comes into effect next year. Supplied.
BUSINESS chambers in KwaZulu-Natal have warned that a proposed 40 percent electricity price increase next year could see many enterprises close down.
President of the Minara Chamber of Commerce, Solly Suleman, said increases over the past few years had crippled businesses, consumers and civil society, and there shouldn’t be any increase at all.
“I don't think the powers that be really understand what’s going on, on the ground. Businesses are closing up, businesses are suffering, consumers are suffering. People can’t make ends meet at the moment and unfortunately the corruption and mismanagement and the maintenance issues in Eskom are now having an impact on the people on the ground.”
Suleman said people and businesses were “soft targets; many could not service their bonds, people were resigning to access their provident funds, while others were exiting their medical aids just to make ends meet.
“There’s nothing we can do about it because once they increase the tariffs we have to pay or then they turn off the electricity. So it’s impossible for us to manage. In fact, that increase will be the last straw… Consumers and businesses will not be able to afford it, forget 40%, not even 10 or 15% will be affordable at this point in time.”
Suleman said that in addition to all the other challenges facing businesses, BEE was adding to that because it wasn’t implemented correctly.
“There’s nothing wrong with the black economic empowerment as long as it’s empowering the masses, or if not empowering the masses, at least benefiting the masses. It’s not happening.”
Melanie Veness from the Pietermaritzburg and Midlands Chamber of Business said a 40% increase would be “absolutely devastating”.
“Businesses are still trying to recover post-Covid and the July 2021 riots. We still have businesses that are going into liquidation that have just struggled and struggled to get on top of it and just haven’t managed to. So that level of increase will be the final nail in a lot of businesses’ coffins,” she said.
Veness said it would have a negative impact on the competitiveness of practically all businesses, especially manufacturers where electricity is a high input cost, a 40% increase would be a disaster.
“It’s mind-blowing.”
She said while the chamber’s function was to support businesses, there wasn’t much they could do when such hefty increases were implemented.
The Overport Ratepayers Association in Durban said that if implemented, the increase it would have severe financial repercussions for everyone.
“It places an undue burden on already struggling households and businesses, exacerbating economic challenges faced by our community. If this tariff increase is allowed, it will force many residents to make distressing choices between essential needs like food and electricity. Families and businesses alike will be hit hard, compromising their financial stability,” it said.
The DA has drawn up an online petition and called on citizens to sign it in protest at the looming increase.
ACDP deputy president Wayne Thring said the proposed increase by Eskom, which was way above the inflation rate, was unconscionable.
“Eskom, which has almost bankrupted itself, has received several bailouts over the years, from government, where the taxpayer had to foot the bill. If the increase is approved, the ACDP believes it may well be the final straw that breaks the consumer’s back.”
Meanwhile, the National Energy Regulator of South Africa (NERSA) said it had not yet received Eskom's final revenue application for the 2025/26 financial year.
“Once the final application has been submitted, NERSA will consider the application, and diligently adhere to NERSA’s regulatory processes,” the regulator said in a statement.
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