The Gauteng High Court issued an order interdicting or preventing municipal electricity distributors from increasing their electricity prices come 1 July 2024.
This was after an urgent application was filed by Afriforum to prevent the National Energy Regulator of South Africa (Nersa) from considering municipalities’ electricity tariff increase applications.
The court noted that distributors could not up their prices as they failed to submit a Cost of Supply study to Nersa.
The High Court found that Nersa’s decision to consider municipalities’ applications for electricity tariff increases without the required cost studies is unlawful and invalid.
Essentially this means that the regulator may not consider any applications for electricity tariff increases from municipalities unless the required cost studies are also submitted.
The court ordered that municipalities whose cost studies are absent, will have to continue charging electricity tariffs based on the existing rates approved for the 2023/2024 fiscal year.
Municipalities’ applications for electricity tariff increases for the 2024/2025 fiscal year can be reconsidered by Nersa but a cost study must be submitted within 60 days of the June 28 date (when the judgement was handed down).
Morné Mostert, a manager of local government affairs at AfriForum said that this was a major victory for civil rights.
“This is a great victory for civil rights. The court has now acknowledged anew that Nersa failed to protect consumers against unlawful applications for electricity tariff increases, something the law compels the regulator to do,” Mostert said.
The use of a cost study for electricity tariff increases is critical, according to Mostert as it gives a clear outline of what municipalities’ tariffs must be to deliver the service properly and maintain networks.
“The applications of municipalities that do not have cost studies are at this stage simply based on an estimate of what it costs to provide the service. However, applications for tariff increases must be made on accurately calculated figures that will ensure that fair tariff increases are passed on to consumers,” Mostert added.
Below is a list of the municipalities that did submit a Cost of Supply study report:
1. Oudtshoorn Local Municipality
2. eThekwini Metropolitan Municipality
3. Swartland Local Municipality
4. Overstrand Local Municipality
5. Drankenstein Local Municipality
6. Bergrivier Local Municipality
7. Saldhana Bay Local Municipality
8. Sakhisizwe Local Municipality
9. George Local Municipality
10. Langeberg Local Municipality
11. Hessequa Local Municipality
12. City of uMhlathuze Local Municipality
13. Newcastle Local Municipality
14. Midvaal Local Municipality
15. Dr Beyers Naude Local Municipality
16. Buffalo City Metropolitan Municipality
17. Nkentoana Local Municipality
18. Tswaing Local Municipality
19. Khai Ma Local Municipality
20. Mohokare Local Municipality
21. Rustenburg Local Municipality
22. Umsobombu Local Municipality
23. Letsemeng Local Municipality
24. Emalahleni Local Municipality
25. Naledi Local Municipality
26. City of Tshwane Metropolitan Municipality
27. Senqu Local Municpality
28. Makana Local Municpality
29. Knysna Local Municipality
30. Steve Tshwete Local Municipality
31. City of Ekurhuleni Metropolitan Municipality
32. Cape Agulhas Local Municipality
33. Walter Sisulu Local Municipality
34. Tswelopele Local Municipality
35. City of Cape Town Metropolitan Municipality
36. Sundays River Local Municipality
37. Musina Local Municipality
38. Cederberg Local Municipality
39. Witzenberg Local Municipality
40. Ba-Phalaborwa Local Municipality
41. Cederberg Local Municipality
42. Ephraim Mogale Local Municipality.
43. Thaba Cheu Local Municipality.
44. Breede Valley Local Municipality
45. Setsoto Local Municipality
46. Theewaterskloof Local Municipality
47. Breede Valley Municipality
48. Swellendam Local Municipality
49. City of Matlosana Local Municipality
50. Moghana Local Municipality
51. Laingsburg Local Municipality
52. Tsantsabane Local Municipality
53. Twelopele Local Municipality
54. Lekwa-Teemane Local Municipality
55. Greater Tzaneen Local Municipality
56. KwaDukuza Local Municipality
57. Moghaka Local Municipality
58. Bela Bela Local Municipality
59. Mokgalakwena Local Municipality
60. Ndhlambe Local Municipality
61. Thembelihle Local Municipality
62. JB Marks Local Municipality
63. Stellenbosch Local Municipality
64. City Power Johannesburg.
65. Centlec (Soc) Ltd
66. Nelson Mandela Bay Municipality
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