Civil rights organisation AfriForum has vowed to take NERSA to task to ensure an electricity refund in South Africa is paid back to all residents. Back in April 2024, Eskom announced a 12.8% tariff increase across the board as part of a Multi-Year Price Determination (MYPD) deal. This was enacted on a municipal level on Monday 1 July 2024 across 178 licensed electricity distributors. The National Energy Regulator had approved the above-inflation increases – and another for 2025 – two-years prior.
However, this week (Monday 19 August 2024) it’s been adjudged in court that NERSA’s approval was unlawful. This is because it failed to do any cost-of-supply (COS) studies, reports Business Tech. Essentially, this means the 12.8% increase was more or less a thumb suck with no evidence Eskom should charge such high tariffs. Therefore, AfriForum believes all consumers entitled to an electricity refund in South Africa.
ELECTRICITY REFUND IN SOUTH AFRICA
At the time of the tariff increase, Eskom was only starting to show improved Energy Availability Factor (EAF) and reduced load-shedding. Nevertheless, it was estimated the average electricity cost would increase from R2 500 to R3 500 per month (working off 900 kWh per month). Meanwhile, impoverished residents turned to free emergency services like indigent benefits and Free Basic Electricity to try keep the lights on.
Moreover, the price pain you’ve been feeling this winter was unlawful and could’ve been prevented. “This is a huge victory in the interest of millions of municipal electricity consumers. NERSA’s plans to push through invalid municipal tariff hikes should never have happened,” said AfriForum.
UNLAWFUL CHARGED MUST BE REIMBURSED
The court ruling highlighted the need for balance between regulatory compliance and municipal financial stability. But, for more than a month, municipalities have been charging residents unlawful rates. And AfriForum says it will send an urgent letter to demand a plan of action regarding the refund of over-recovery. Meanwhile, NERSA says it is currently studying the judgement before it takes a position on the matter.
However, energy experts warn that municipalities experiencing budgetary instability could face significant financial strain if they’re forced to provide an electricity refund in South Africa. “We realise this judgment will have a significant impact on municipalities’ budgets. But a line has now been drawn in the interest of consumers who have been milked as cash cows for years by inept municipalities,” concluded AfriForum.
WHAT DO YOU THINK OF THE BUNGLING OF THESE TARIFF INCREASES?
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