Midvaal Municipality Electricity Tariffs Presentation
Presented by: Municipal Manager; Albert De Klerk
andRobert Mallinson
Tariff as package of services
• Tariff’s were designed on current financial year’s revenue requirements and volumes
• Consideration must be given to the fact that all tariffs in the municipality are part and parcel of a package of services
• Increase are due to almost a 93% increase in the maintenance budget and 33% increase in the staff budget
Tariffs Increase
• Increase on KWh and KVA is 28,64%
• Increase on Basic charges is 15%
• Total increase on income is 21.34%
Income 2010/11 R142.332 million
Income 2009/10 R117.3 million
Increase in maintenance costs
• Increase on income budget due staff and maintenance increase is 5.5% Maintenance 2010/11 = R 8.1 millionMaintenance 2009/10 = R4.2 millionIncrease in maintenance = R3.9 millionMaintenance cost increase = 92.29%Staff increase (excl 8% general increase) is R2.57 million ,thus 32.96% of the staff budget
Basic National Treasury Tariff Formula
• Tariff increase = (%B x %BPI)+(%OC x %OCPI)• Where: %B = the % weight of bulk cost
to total input cost (0.67) %BPI = the % bulk price increase (0.289) %OC = the %weight of the other costs
in total input cost (0.33)% OCPI = the assumed % price increase
of other input costs (0.1911)• Tariff increase = (0.67x0.289)+(0.33x0.1911)
= 25.673% Thus the effect of our tariff increase on the budget is 25.673 %
Reasons for increase
• Maintenance and repairs budget increase substantially
• Staff budget increase
• Cross subsidization of indigents
• High loss of energy due to faulty meters and theft
Aged Assets
• Assets in various area’s has exceeded there useful life
• The remaining asset life in Midvaal is 36.6%• The replacement cost of the assets is R420 million
• Nersa require 3% of asset value for upgrade thus R13,5 million. Council cannot borrow
• Annual planned outages 8 unplanned outages 150
Substation in Kookrus Most transformers are in the state as
shown
Transformer in Kookrus
Mini‐sub in Kookrus overheating
Left: Mini‐sub showing oil overflow Below: Amp meter indicating over current
OVERLOADED MINI‐SUB
Mini‐sub that was overloaded in Kookrus
OVERHEAD DAMAGED CONDUCTORSIN RISSIVILLE
House connections that needs urgent replacement
Damaged insulation
DAMAGED EARTH WIRES LAYING ON GROUND ‐ 11KV LINES
TREES IN 11KV LINES
Thank youMay the lights keep on burning
Questions
Midvaal Municipality