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Tuesday, June 9, 2009.

From Creamer Media in Johannesburg, I'm Shannon O'Donnell.

Making headlines today:

On Tuesday, Steel and Engineering Industries Federation of South Africa council member Guy Harris told the National Energy Regulator of South Africa that it was economically and morally unfair for current electricity users to have to subsidise future consumers. This was during the second day of the Nersa public hearings into Eskom's proposed 34% interim tariff hike.

Seifsa proposed that any part of current increases should be funded by way of an Eskom Development Bond. He said that the increases were there to strengthen financial ratios rather than meet historical costs and not future capacity.

Seifsa also highlighted its concerns regarding the proposed tariff increase. It said that it would impact negatively on jobs and exports in all sectors, as well as lead to higher inflation as well as impact on economic growth.

South African trade union confederation the Congress of South African Trade Unions has rejected Eskom's 34% interim tariff increase application. It called for the consultation process on the utility's funding model to be fast tracked.

Cosatu industrial policy coordinator Jonas Mosia told the National Energy Regulator of South Africa that the current economic conditions didn't warrant such a "huge" tariff increase.

He said that government information showed that pressure on the electricity grid was easing as a result of the economic crisis. This indicated that Eskom might not be experiencing such a "low-reserve margin" and high related costs, as suggested in its application.

Further, the union called for an electricity pricing policy that had to ensure that heavy electricity users pay more for electricity, and the poor less.

Also making headlines:

Eskom's late tariff submission creates legal problems for municipalities.
South Africa's drive to create millions of job opportunities will cost 10-billion-rand over the next three years.
Mahindra South Africa is to start a local vehicle assembly.
And, PetroSA says that action is required on crude oil refinery needs.

That's a round up of news making headlines today. For more on these and other stories please visit engineeringnews.co.za.