AfriForum, a civil rights organisation, is demanding transparency from the National Energy Regulator of South Africa (Nersa) following a landmark court victory that forced municipalities to stop charging unlawful electricity tariff hikes.
The organisation is now pushing for a list of municipalities that have implemented these illegal hikes and for refunds to be issued to consumers who were overcharged.
The saga began in June when the Gauteng High Court in Pretoria ruled that Nersa's method for determining tariff increases was "unlawful and unenforceable". The court found that the 2024/2025 tariff hikes were not based on the legally required cost-of-supply studies, which detail the actual costs of providing electricity.
AfriForum had taken Nersa to court, arguing that the regulator's failure to enforce the requirement for cost-of-supply studies violated the Electricity Regulation Act 4 of 2006. The court agreed, ruling that municipalities must submit these studies to justify any tariff increases. If they fail to do so, they must maintain their 2023/2024 tariffs.
Nersa and the South African Local Government Association (Salga) appealed the ruling, but the court upheld its decision in August. Salga argued that municipalities could not afford to pay Eskom for electricity without raising tariffs, but the court ruled that suspending the relief would unfairly burden consumers with overcharges.
Despite the court's clear ruling, AfriForum's manager of local government affairs, Morné Mostert, claims that Nersa is "reluctant" to release a list of noncompliant municipalities.
"Nersa is extremely silent on which municipalities that they are considering, and which municipalities did hand in the cost-of-supply studies, and the whole scope of the court case, Nersa is reluctantly silent on who the municipalities are," Mostert told City Press.
AfriForum has requested the list from Nersa, but the regulator has remained silent. This lack of transparency has raised concerns about the effectiveness of the court ruling and the potential for municipalities to continue overcharging consumers.
Nersa has announced its intention to petition the Supreme Court of Appeal (SCA) to overturn the high court's ruling. AfriForum plans to challenge this petition, arguing that the court's decision was a victory for consumers and a recognition of Nersa's failure to protect them from unlawful tariff increases.
"Nersa, as a role player, is very reluctant to communicate with us … and during our court case, there were many excuses made by Nersa on why they’re not communicating with AfriForum … we will still speak to our legal team to see if we can make sure that the [high court’s] order is applied,” Mostert said.
Nersa's CEO, Nomalanga Sithole, confirmed the SCA petition, stating that the regulator believes the court's decision will have "huge implications" and a "negative impact" on the electricity industry.
AfriForum has also called for refunds for consumers who were overcharged, arguing that it is Nersa's duty to ensure that municipalities have the required cost-of-supply documents.
"Every electricity consumer in South Africa has the right to understand what it is exactly that they’re paying for," Mostert said.
"Up until this story, none of the municipal consumers knew what they were paying for. Beforehand, municipal consumers had no mechanism in place where you can actually question the rationality of the tariff that you are paying for."
Nersa declined to comment on the SCA petition and the list of municipalities, stating that it is still finalising its internal processes.
