Eskom: No power to the people

[kilo39]

South Africans will have to pay more for electricity as Eskom plans to increase prices in the next three years to pay for infrastructure, said company chief executive Thulani Gcabashe, addressing the Johannesburg Press Club on Thursday.
Eskom price hikes to fund infrastructure investments Oct 6, 06

I would really like to know what these peeps have been doing for 12 years - and where is all the money and any investment - based on the electricity bills peeps are already paying?

Has anything happened in 12 years beside more apartheid laws and less jobs? Has anything got any cheaper due to "all this demand?"

Has anything got any better for the "man on the street?"

 

[Rkootknir]

I would really like to know what these peeps have been doing for 12 years - and where is all the money and any investment - based on the electricity bills peeps are already paying?

Has anything happened in 12 years beside more apartheid laws and less jobs? Has anything got any cheaper due to "all this demand?"

Has anything got any better for the "man on the street?"

Err, they've de-mothballed 3 power stations (which is quite a major achievement if you take a look at what it entails).

New power plants were not allowed by government (since around 1990 IIRC) which is one of the reasons why our electricity is ridiculously cheap (IOW, no new plants were planned and so no higher prices required to fund expansion).

I don't know why anything would get cheaper due to more demand?
Basic economics tells you that more demand implies higher prices.

 

[The_Unbeliever]

I don't know why anything would get cheaper due to more demand?
Basic economics tells you that more demand implies higher prices.

It is about to happen... we were lucky for a long while, but now demand is outstripping supply....

 

[kilo39]

I don't know why anything would get cheaper due to more demand?
Basic economics tells you that more demand implies higher prices.

Oh - so telkoms basic tenet of business is wrong? More peeps = higher prices?

SA is the only country in the world where if you buy more you pay more, ie, cheaper to buy many of less than one in bulk.

More demand = equals more paying peeps = equals more money in the system = more investment = cheaper prices

More productivity leads to cheaper prices = hence what is wrong with this picture - and your view of the world that more equals more?

 

[nthdimension]

In theory high demand would lead to an incentive to increase supply, and the per unit cost of that supply would go down, so the producer can realise the same per unit profit while charging less. If supply is not increased then producers are inclined to increase prices - essentially because they can, hence Telkom's extremely high prices.

 

[icyrus]

I don't know why anything would get cheaper due to more demand?
Basic economics tells you that more demand implies higher prices.

This applies with fixed or limited supply right?

 

[nthdimension]

This applies with fixed or limited supply right?

And where it is very expensive to increase supply. Everyone wants returns today so they aren't interested in recovering their investment, with profits, over the long term.

 

[Drone 42]

New power plants were not allowed by government (since around 1990 IIRC) which is one of the reasons why our electricity is ridiculously cheap (IOW, no new plants were planned and so no higher prices required to fund expansion).

They were not allowed because there were over supply at that time. This has all changed and lack of planning by eskom and the government has caused a problem because now demand is almost more than supply.

I don't know why anything would get cheaper due to more demand?
Basic economics tells you that more demand implies higher prices.

Don't know where you got your economics lesson from but that's only how it works if there is one supplier. In the real world, where there is a true free market system the prices will come down.

What have they been doing with all the money they had made with the infrastructure they got from the old government? No they did not maintain the current infrastructure or even used some money to build new power stations. They paid the Eskom CEO almost a million a month for doing nothing

Now they want to charge people more because they need to spend some money finally. That's eating into their beer money

 

[Paul_S]

What really annoys me are the service fees that Eskom charge.
Service charge : R115.94 / month
Network charge : 160.40 / month
Total "rental" : R 276.34 / month

I've lived at the same place for more than 24 years and they've only had to replace the transformer once (which leaked oil and blew up due to zero maintenance). The transformer is shared between 4 properties.
Eskom get about R13264.32 / annum (4 customers) for that transformer on the road which was replaced once so far. The 11kV lines are still original. That's over a quarter of a million Rand over a 20 year period.
Just exactly how many times over have I paid for the infratructure over a 24 year period?

What about all the people who can't afford electricity?
This is only going to make things harder for them and make the dissparities even bigger between the rich and the poor.
I mean you can't run many businesses without electricty ...

 

[wallace]

We pay more so that the neighbouring countries can have cheap electricity 

 

[antowan]

Basic economics tells you that more demand implies higher prices.

Depending on the product and the market forces. If there is a lot of competition the price might drop. Large scale production inevitably brings with it a per unit drop in price, but with power this is not the case...

More demand doesn't allways result in higher prices. Eskom is using investment as a good excuse to raise pricing. It is a bad excuse because the proper way of doing this expansion would be to recover cost over an extended period of time.

 

[DigitalSoldier]

What really annoys me are the service fees that Eskom charge.
Service charge : R115.94 / month
Network charge : 160.40 / month
Total "rental" : R 276.34 / month

I've lived at the same place for more than 24 years and they've only had to replace the transformer once (which leaked oil and blew up due to zero maintenance). The transformer is shared between 4 properties.
Eskom get about R13264.32 / annum (4 customers) for that transformer on the road which was replaced once so far. The 11kV lines are still original. That's over a quarter of a million Rand over a 20 year period.
Just exactly how many times over have I paid for the infratructure over a 24 year period?

.

Actually most transformers in the country get a service atleast twice a year. Most of the time the contractors hired by municipality's (eskom doesnt really touch most of the transformers only the muni's send out tenders for private companies ) only take samples of the oil and then decide if its worth it to service the transformer based on the results. And even though a transformer is fixed today and all leaks repaired theres still a chance it will get another leak.

maybe some electrical engineer can give more info this is just stuff i picked up from my dads ramblings

 

[BTTB]

150 Million

Koeberg bolt repair cost R150m!!!

The cost of repairs from a loose bolt that crippled one of Koeberg's generators and resulted in sweeping blackouts in the Western Cape was R150-million.

This included the cost of the replacement rotor and its transportation from Europe to Cape Town.

But Eskom was unable to put a price on the losses to the province from the six power failures that occurred between November and February.

In reply to a question by HC Smidt, of the DA, about the cost of the blackouts and repairs, Public Enterprises Minister Alec Erwin said the R150m cost of the damaged generator was covered by insurance.

"Additional maintenance and reinsulation of key power corridors was carried out at a cost of approximately R7-million. It should be pointed out that additional capital expenditure will be incurred over the next two years to enhance system security and strengthen the transfer capability to the Cape," Erwin said.

As to Eskom bonuses for 2006/07, Erwin said bonuses to Eskom's CEO were based on "achievement of key performance targets".

As a Public Utility we have to pay for these costs?
Sorry to say this, but I would like to see that Insurance Claim in writing before I believe it.
One can expect that Eskom fronted the money to pay for the repairs etc.
Was Eskom 100% covered and did the Insurance Company pay out?
Imagine what the premiums would be like now after that kind of claim?

I will take any statement from Erwin with a pinch of salt as it has now come to light that there may never have been a bolt at all and with all this nonsense actually pointing to a lack of maintenance, do not be surprised if the Insurance Company contests the claim.
Which means the R150 Million will be added to our mutual Bills, if it hasn't already. You can bet on that.

That is my take on the matter. Open to comment as usual.

 

[Paul_S]

Actually most transformers in the country get a service atleast twice a year. Most of the time the contractors hired by municipality's (eskom doesnt really touch most of the transformers only the muni's send out tenders for private companies ) only take samples of the oil and then decide if its worth it to service the transformer based on the results. And even though a transformer is fixed today and all leaks repaired theres still a chance it will get another leak.

Well the one our street leaked oil for about 10 years before it blew up.
Nice oil streaks down the side and oil soaked ground under it. I mean it was an eye-sore to look at.

Maybe the municipalities in the cities maintain their infrastructure but I can assure you from what I've seen that Eksom do zero maintenance at the street level to their equipment. I'm sure they maintain their power plants and substations though ... well I hope they do!

 

[kilo39]

Koeberg has got insurance? For what if I may ask - irradiated people?

He is a liar. Why should we believe anything he says. Show me the bolt!