Amid the ever-vocal calls for a weaker rand, market commentator Francois du Plessis on Monday argued that a firm rand would potentially help keep the cost of electricity down over the long-term.

South African power utility Eskom would need 1.902 million tons of steel for the construction of the Medupi and Kusile power stations, metal group Arcelormittal (ACL) noted in an annual results presentation in February.

And that against only 100 000 tons of steel needed for the 2010 World Cup Stadiums, and 15 000 tons needed for the Gautrain Project, the group noted.

Du Plessis, portfolio manager and executive director of Vega Asset Management, told I-Net Bridge that the cost of imported steel and cement needed for the construction of Eskom''s Medupi and Kusile power stations would be drastically reduced if the current strength of the rand were maintained.

"You can imagine how prices would increase if the rand was at 10 against the dollar, like Cosatu and other trade unions have called for," he said.

"The relative strength of the rand is actually a positive to help keep the cost of electricity down," he said, noting that Eskom would need to cover the cost of importing steel and cement by raising tariffs again.

Eskom is currently looking to fund its R426-billion capital investment expansion programme over five years, of which over 70 percent is earmarked for electricity generation.

The group recently announced that an additional R190-billion would need to be borrowed to finance its build programme to 2017, of which R115-billion would be to 2013.

Earlier this year the National Energy Regulator of South Africa''s (Nersa) approved electricity tariff price increases of 24.8 percent from April 2010, 25.8 percent from April 2011 and 25.9 percent from April 2012.

These price rises, although substantial, were significantly less than the average annual price increase of 35 percent over the period that was requested by Eskom in its revised application at the end of November 2009.