The North Gauteng High Court has overruled the National Energy Regulator’s (Nersa) decision to allow Eskom to implement a 9.4% tariff increase.

Nersa is currently studying and analysing the North Gauteng High Court ruling regarding Nersa’s decision to approve Eskom’s Multi-Year Price Determination Regulatory Clearing Account (RCA) for 2013/14 financial year.

“Once Nersa has thoroughly examined the judgement by the High Court, it will take a position on the matter, which will then be communicated in due course,” the energy regulator announced.

The ruling was made on the grounds that the regulator’s rules and methodology had not been properly applied.

In March Nersa granted Eskom a 9.4% tariff increase for the 2016/17 financial year. This increase became effective from 1 April for Eskom’s direct customers and from 1 July for municipal customers.

The price hike was approved to enable Eskom to recoup expenses it hadn’t budgeted for in 2014.  Eskom says this was because the utility was forced to use expensive fuel for its gas turbines to keep the lights on.

The Democratic Alliance has implored Nersa and Eskom to not appeal this decision. This will mean that the tariff rate would revert back to a 3.4% increase on 2015 tariffs.

“Eskom notes the judgment by the Gauteng High Court on the RCA and will await a decision on the way forward by the National Energy Regulator of South Africa,” Eskom said in a statement.

 

OUTA wants to sue

Meanwhile OUTA has announced that it is investigating the possibility of a class action lawsuit against Eskom on behalf of public to recoup the amounts unlawfully charged.

“We applaud the businesses and the Nelson Mandela Bay Business Chambers for successfully challenging the irrational manner within which NERSA approved the increase in Eskom’s tariffs. Although not all amounts overcharged will be deemed significant in the eyes of some, it is an absolute matter of principle that Eskom pay back every cent they have overcharged,” said Ivan Herselman, Director of Legal Affairs at OUTA.