The National Energy Regulator of SA (Nersa) and Eskom are being implored not to appeal against a decision which set aside the granting to the power utility of a 9.4% increase for this year.
The DA said yesterday that Tuesday’s decision by the High Court in Pretoria to set aside Nersa’s decision to grant Eskom the increase was a step forward in bolstering economic growth and retaining jobs.
“We implore Nersa and Eskom to not appeal [against] this decision,” DA shadow energy minister Gordon Mackay said.
“This will entail that the tariff rate will revert to a 3.4% increase on 2015 tariffs.”
The ruling by the court follows an application by five Nelson Mandela Bay energy intensive businesses and the Nelson Mandela Bay Business Chamber which asked the court to set aside the decision taken by Nersa in March in relation to the 2013-14 Regulatory Clearing Account (RCA) application by Eskom.
The RCA is a mechanism allowed by Nersa to enable Eskom retrospectively to recover costs after the close of the financial year through raising tariffs in the following year.
“High electricity prices are a burden to business and to the average person in the street,” Mackay said.
“It can act as a hand-brake on job creation‚ stifling the economy, and it will hurt individuals in their pockets and daily spending patterns.”
He said that‚ with rampant unemployment and the economy on the brink of recession‚ this lower electricity price tariff would be a boon to South Africans and the business community. The judgment will not have an immediate effect on ratepayers for several reasons, including that the court did not rule on current tariffs charged by municipalities and Nersa and Eskom can still appeal.
This was confirmed yesterday by Bay acting city manager Johann Mettler.
“The status quo remains,” he said.
“There was no ruling on the current tariffs.”
Mettler said Nersa traditionally provided the municipality with tariff guidelines and had not issued new ones.
“We must now wait to see what Nersa will do and there are a number of possibilities.
“As far as the municipality is concerned, the judgment does not currently have any effect on municipal revenue.
“We would, however, like to have this matter finalised as soon as possible as we believe that a long, drawn-out process will be detrimental to everyone concerned.”
Nersa said yesterday it was studying the ruling.
Nelson Mandela Bay Business Chamber deputy president and electricity and energy task team board leader MC Botha said the court ruling would benefit all electricity users in the country.
The chamber said electricity users would potentially have only a 3.5% increase from next year, as opposed to the 8% granted to Eskom by Nersa.
Organisation Undoing Tax Abuse (OUTA) says it is investigating the possibility of bringing a class action against Eskom.
OUTA said last night that it would be engaging with various experts to assess the viability of launching an action on behalf of the public to recoup the amounts unlawfully charged.