SA electricity consumers warned about unregulated charges precedent

Cape Town – Pressure group Stop COCT has alerted electricity consumers countrywide about the “possibility” through which municipalities can now add unregulated amounts to electricity tariffs by seeking council approval only.

This comes after a meeting Stop COCT had with the City of Cape Town and the Energy Regulator of South Africa (Nersa) on Tuesday regarding a multiple number of complaints around electricity tariff issues and practices implemented by the City.

For months Stop COCT had been asking questions around the discrepancy between the City’s implemented tariffs across all blocks versus what Nera publishes as approved tariffs on their website.

Since 2016 the City’s implemented electricity tariffs were between 2% and 18% higher than the Nersa-approved tariffs, StopCOCT said.

While Nersa had indicatied that the meeting would be a mediation session, the City later reported this meeting as a normal, but closed meeting, Stop COCT said on Wednesday.

What concerned Stop COCT too was that representatives were turned away from the meeting and itT had to nominate four people randomly to sit in on the mediation session.

“Many of our issues were not addressed as the City chose to have a single representative who was not capable to deal with the many issues we had.

“The electricity director, Dr Les Rencontré, could not deal with billing issues, the City’s debt collection practices, public participation Issues, electricity budget issues or the effect of property values on electricity tariffs.

“Stop COCT had to accept that the City was going to only discuss the home user tariff issue.”

Rencontré explained the difference of R0.23 per unit in this block where the City tariff (R1.75) is higher than the Nersa-approved tariff (R1.52) as an “unregulated” portion of the tariff, Stop COCT said.

In Nersa’s view, this addition to its approved tariff is outside its scope of regulation.

“The City told Stop COCT that no authority other than the city council is needed to approve this unregulated addition to Nersa’s approved tariffs.

“The City adds this “unregulated” amount across the entire inclined block tariff (IBT) the City uses to set lifeline, domestic and home eser tariffs.

“Since 2016 up to R0.32 was added, ‘unregulated’, to each unit of electricity Capetonians purchased.”

Stop COCT is alarmed that a “precedent has now been created by the City of Cape Town and accepted by Nersa which all municipalities can now follow to add unregulated amounts to our electricity tariffs. Only council approval is required”.

The City said in a statement yesterday it had met with Nersa and a number of complainants who had disputed the City’s electricity tariffs.

The City reiterated its position that “all components of the City’s electricity tariffs were approved by the relevant authorities, namely Nersaand the City’s council in accordance with all applicable laws”.

“The City maintained that as the fixed electricity charge in particular had been approved by Nersa, the complaints about the charge did not constitute a dispute and could thus not be mediated in terms of Nersa’s mandate.”

Articel by IOL