Lobby group AfriForum says it is taking the National Energy regulator (Nersa) to court. This comes in an effort to stop Nersa from considering municipalities’ applications for electricity tariff increases, scheduled for implementation on the 1st of July, without the mandatory cost studies.
A High Court order from October 2022 and the Electricity Regulation Act 4 of 2006 both require these cost studies for tariff increase applications.
AfriForum Manager of Local Government Affairs, Morné Mostert elaborates.
“For the past decade, there was actually a responsibility of municipalities to set up what they call or the what the act calls a cost of supply studies basically, a study that informs you on what the exact tariff is that the municipality can ask Nersa. Remember that municipalities make a profit from selling electricity, so it’s very important for us the consumers to understand what tariff they charge you.”
In a statement, AfriForum has accused NERSA of not complying with the court order as they have sent a communication to municipalities where they are now providing municipalities with a new revenue requirement template that they can use when applying for rate increases – this instead of the cost of supply study as the court ordered.
“The use of an approved template rather than the cost of supply study is a concern as it could mean that Nersa acts contrary to the court order. We are looking for verifiable figures to indicate what municipalities’ rates should be. A cost of supply study is the starting point to steer municipalities and Nersa in the right direction,” Mostert adds.
PODCAST | AfriForum takes Nersa to court over electricity tariff increases:
