Government’s proposed deal with Karpowership to buy electricity generated on its three floating power stations over a period of 20 years will expose consumers to considerable risk. Maduna Ngobeni, acting chief operating officer of the department of energy’s office for independent power producers (IPPs), recently confirmed that, among other things, fluctuations in the international price of liquefied natural gas (LNG) and the dollar/rand exchange rate will be passed on to consumers. Other pass-throughs are carbon tax and environmental levies. The proposed agreements form part of the department of energy’s risk mitigation power purchases from IPPs Mike Schüssler of Economists.co.za warned that consumers could find themselves at the same disadvantage Eskom did with its historic price agreement to supply the Hillside aluminium smelters in Richards Bay: This was done at a tariff linked to, among others, the dollar-denominated price of aluminium set in London.