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Midvaal Municipality Electricity Tariffs Presentation
Presented by: Municipal Manager; Albert De Klerk
andRobert Mallinson
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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
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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
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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
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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 %
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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
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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
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Substation in Kookrus Most transformers are in the state as
shown
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Transformer in Kookrus
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Mini‐sub in Kookrus overheating
Left: Mini‐sub showing oil overflow Below: Amp meter indicating over current
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OVERLOADED MINI‐SUB
Mini‐sub that was overloaded in Kookrus
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OVERHEAD DAMAGED CONDUCTORSIN RISSIVILLE
House connections that needs urgent replacement
Damaged insulation
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DAMAGED EARTH WIRES LAYING ON GROUND ‐ 11KV LINES
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TREES IN 11KV LINES
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Thank youMay the lights keep on burning
Questions
Midvaal Municipality