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The North Gauteng High Courthas ordered that only those municipalities that had done cost-of-supply studies were entitled to an electricity tariff increase on 1 July.
Moneyweb reports that this follows the announcement by the National Energy Regulator of South Africa (Nersa) on Friday that stated that it had approved the tariff applications for 178 municipal distributors.
The order comes after civil rights organisation, Afriforum challenged Nersa’s methodology used when considering the applications.
According to legislation, distributors can recover their efficient cost plus a reasonable margin.
The court gave Nersa a year to switch to this method and expressly forbade it from using the unlawful method again in determining the tariffs for 2024/25.
This required municipalities to do cost-of-supply studies, but only 66 did so.
However, chances are that this won’t be of assistance since such a study can take a year to complete, including the tender process to appoint service providers, the study itself, and the consultation process before it is approved by the council.
The 2022 court ruling was on the back of the Nelson Mandela Bay Business Chamber’s challenge in this regard.
- This article first appeared on Moneyweb https://www.moneyweb.co.za/news/south-africa/breaking-no-electricity-tariff-increase-for-most-municipalities-on-1-july/
