Free State Agriculture (FSA) president, Francois Wilken, has criticized Eskom's proposal to significantly increase fixed cost charges for the agriculture sector. He argued that the plan to alter the billing structure to 70% fixed costs and 30% variable costs contradicts basic business principles of boosting sales to enhance revenue.
Wilken highlighted Eskom's inability to fulfill power demand and suggested that the proposed adjustments aim to recover sales losses, partly due to the agricultural sector's shift towards alternative energy sources. He emphasized that FSA would strongly oppose Eskom's proposal once it is presented for public consultation by the National Energy Regulator of South Africa (Nersa). Wilken also pointed out the broader economic implications, particularly for small farming operations and processors, emphasizing the unsustainability of increased overheads for farmers. He concluded by noting the adverse effect of escalating fixed charges and potential carbon taxes on consumer inclination towards off-grid solutions, especially in the context of declining alternative energy costs.
Source: farmersweekly.co.za