The National Energy Regulator of South Africa (Nersa) plans to appeal a court order issued by the Pretoria High Court in a case brought forward by nonprofit civil rights organisation AfriForum.
AfriForum submitted an urgent application to the court to prevent Nersa from proceeding with considerations on licenced electricity distributors’ tariff applications, including municipal and private distributors, for the 2024/25 financial year.
The High Court found that Nersa’s decision to consider municipalities’ applications for electricity tariff increases without the required cost studies is unlawful and invalid.
The ruling follows Nersa having completed the approval of tariff increases for 187 distributors, effective July 1.
The court order has an impact on distributors that have submitted their tariff applications to Nersa without cost of supply studies.
This means that the regulator may not consider any applications for electricity tariff increases from municipalities unless the required cost studies are also submitted.
As such, the court ordered that municipalities whose cost studies are absent will have to continue charging electricity tariffs based on the existing rates approved for the 2023/24 financial year. Municipalities’ applications for electricity tariff increases for the 2024/25 financial year can indeed be reconsidered by Nersa provided the necessary cost studies are submitted within 60 days from today.
With the leave to appeal having been filed, the Superior Courts Act, 2013 provides that an application for leave to appeal suspends the operation and execution of a decision, pending the outcome of the application.
Consequently, Nersa’s decisions still stand and distributors can proceed to implement the approved tariffs while the appeal is being processed.
AfriForum maintains that only 66 of the 178 approved applications submitted cost studies.