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Tuesday
Feb282012

Environmental levy

An article in the February 2011 edition of this Bulletin advised readers that the existing levy on `electricity generated from nonrenewable and nuclear energy sources would increase by 0,5c/kWh to 2,5c/kWh from April 2011’. The Finance Minister said at that time that `…… the increase should not impact on electricity tariffs, as it had already been taken into account in the National Energy Regulator of South Africa’s approved tariff structure for the period 2010 to 2013’.

In his recent budget speech, the Honourable Finance Minister announced another 1c/kWh increase in this environmental levy on nonrenewable electricity sources to 3.5c/kWh with effect from 1 July 2012. Minister Pravin Gordhan is quoted in an Engineering News Online article published on 23 February 2012 as stating that “….there would be little overall impact on electricity prices”.

The article also reports that `The increased revenue would be used to fund energy-efficiency initiatives such as the solar water heater programme. The levy would replace the current funding mechanism, which was incorporated into State-owned power utility Eskom’s yearly tariff application, and would enhance transparency and enable government to use alternative agencies to deliver the energy-efficiency initiatives.’

A copy of the Engineering News Online article is available here.

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