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The National Energy Regulator (NERSA) announced at its meeting held today, 29 June 2015, that it has decided not to approve Eskom’s application for the Selective Re-opener of the third Multi-Year Price Determination (MYPD3) application for its Open Cycle Gas Turbines (OCGTs) and the Short-Term Power Purchase Programmes (STPPPs) and the impact of the increase in Environmental Levy.

The Energy Regulator has requested that Eskom submits:
a. an application for the adjustments in the allowed revenue in accordance with the MYPD
methodology; alternatively
b. a new application for the period 01 April 2016 to 31 March 2019 with indicative projections
for the period 01 April 2019 to 31 March 2021.

On 30 April 2015, the Energy Regulator received Eskom’s application for the Selective Re- opener of the MYPD3 application for OCGTs and STPPPs and the impact of the increase in the Environmental Levy for the 2015/16 to 2017/18 period. Eskom’s selective reopener application requested cost recovery of R32,9bn for OCGTs and R19,9bn for the STPPPs.
According to Eskom’s application, the selective re-opener would have resulted in a total price increase of 25.30% for 2015/16. This would consist of the 12.69% already approved by the Energy Regulator, 10.10% selective reopener for OCGTs and STPPPs and 2.51% change in environmental levy by 2c/kWh.

The Energy Regulator made the decision after conducting due regulatory processes, which included publishing Eskom’s application and inviting written comments from stakeholders, as well as holding a two-day public hearing on Eskom’s application.

Issued by NERSA