Submission to NERSA_Comments on the MYPD 3 Application

by ALTMAN,M., 2013
Centre for Poverty Employment and Growth, Human Sciences Research Council

This paper is a submission to NERSA in respect of the MYPD3. It follows two earlier reports in respect of the MYPD1 & 2 (INSERT LINKS TO INFRA02 AND 04). Altman provides background to the MYPD3, followed by comments and recommendations on the price path, municipal pricing, Eskom’s viability, and the potential impact of the proposed electricity prices on employment and the economy. In 2010/11, the Human Sciences Research Council updated its earlier work to take into account new circumstances. This report assessed how the chosen price path might affect the economy, employment and incomes. The financial model was updated to build a view to 2030, in order to consider the impact of electricity pricing on Eskom’s sustainability. The paper also explored the extent to which firms have implemented efficiency improvements since the electricity crisis, and their future plans. Another critical component of this analysis was to explore the potential impact on poor households, and specifically the distributional impact of policy choices on electricity prices and employment creation. This submission focuses on specific insights and recommendations, and does not represent a revision of the earlier two studies, given that many of the issues raised in those studies remain relevant.