050910 Electricity pylons carry power from Cape Town's Koeberg nuclear power plant July 17, 2009. South Africa will need 20 gigawatts (GW) of new power generation capacity by 2020 and would require double that amount a decade later to meet rising demand, the country's power utility said September 7, 2009. Picture taken July 17, 2009. REUTERS/Mike Hutchings (SOUTH AFRICA ENERGY BUSINESS)

Metal workers' union Numsa rejected Eskom’s proposed annual 16 percent rise in electricity tariffs at a National Energy Regulator of SA (Nersa) hearing in Bloemfontein on Monday.

“We propose a inflation rate increase and a review of the electricity price system,” National Union of Metalworkers of SA deputy president Andrew Chirwa said.

Chirwa said the indirect cost of such an increase on workers' daily expenses would be huge.

“Eskom does not talk about that.”

Eskom has applied to increase the electricity price 16 percent each year over the next five years.

The power utility estimates it would need R1.1 trillion for its infrastructure maintenance, staff costs, and growth.

Chirwa said those workers earning R3000 and less per month would be the hardest affected.

The Congress of SA Trade Unions said the increase would plunge more people into poverty.

“With a 25 percent unemployment rate, how can you expect people to accept this increase?” the union federation's Free State secretary Sam Mashinini said.

A 16 percent increase would destroy the prospects of small and medium-sized enterprises. Municipalities had huge arrears because people failed to pay electricity bills, and the number of disconnections and illegal connections was increasing.

He said the same people who could not pay for electricity now would be expected to pay the new increase as well.

“It goes from Eskom to municipalities to consumers, ordinary people. That is the reality. How can or will they pay?”

Mashinini said Eskom should operate to achieve development, and not as a private profit making company.

He urged Nersa to hold hearings in rural areas as well.

“You should go to smaller areas of the Free State. You would hear a different story,” Mashinini said. - Sapa