The National Energy Regulator of South Africa (Nersa) has said it was considering the high court judgment staying the leave to appeal application by Nersa and the South African Local Government Association (Salga).
In a statement, Nersa said was currently studying the judgment, and once it had thoroughly examined the judgment handed down by the high court, it will take a position on the matter, which will be communicated in due course.
The High Court in Pretoria on Monday denied Nersa and Salga leave to appeal its earlier judgment precluding Nersa from approving tariff increases in more than 100 municipalities.
This puts at least 112 municipalities at risk of having to refund end-users with regard to increased amounts billed since July 1, the date when the new tariffs are implemented every year.
AfriForum approached the court after Nersa in January changed course regarding the method it would use to consider municipal tariff applications for 2024/25 and for scrutiny of the “lawfulness” of Nersa’s methodology employed to determine tariff increases sought by municipalities – requirement that municipalities charge for the cost of supply of electricity – requirement of a cost of supply study – ensuring municipalities charge only for the cost of supply.
While Nersa earlier communicated to municipalities that tariff applications must be done on the basis of cost-of-supply studies (CoS), it gave those municipalities that failed to do such studies a way out in January.
The high court in 2022 had ordered Nersa to stop using its earlier guideline-and-benchmark method and comply with the law, and electricity pricing policy that requires tariffs to be based on CoS. It gave Nersa and municipalities a year to adjust, but more than 100 of the 257 still failed to do CoS, and Nersa failed to develop a new compliant methodology.
AfriForum has said Nersa’s doggedness would be messy when it had to refund the customers already billed under the questionable tariff structure.
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