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  • keyboard_arrow_rightKaya Biz: Methods used by NERSA to increase municipal tariffs to 7.47% in question

Kaya Biz: Methods used by NERSA to increase municipal tariffs to 7.47% in question

Kaya 959 Reporter

From July 1, the energy regulator Nersa proposes an average increase of 7.47 per cent in municipal electricity bills.

It advises that towns continue to employ the historic approach of tariff setting for the coming fiscal year by offering a guideline for the percentage increase to be adopted relative to existing tariffs, as well as tariff benchmarks for distinct customer categories.

There have been questions posed by many stakeholders across the country around how the tariffs will be calculated, as well as legal action challenging this methodology proposed by NERSA.

Also Read: Nozuko Ntshangase on not feeling “good enough”

Dr. Tk Pooe spoke to Gugulethu Mfuphi about what this new proposal will mean for consumers as well as to give an understanding of NERSA’s pricing challenges.

Also Read: Zakes Bantwini has a new project coming out this month

Pooe says NERSA’s role is to regulate the whole energy environment, with the view that whatever decision they make needs to consider the impact on the consumer.

“NERSA operates in an environment where energy supply has not been great, by this I mean that most of our energy comes from Eskom. If we actually study what has been happening with Eskom lately, there’s a bit of unsustainability.”

One thing that NERSA has been having a problem with, even to a point of court challenges, is that Eskom has been challenging them on their methodology, and has not taken into consideration the environment we are in.”

Political parties have also expressed their disappointment with the latest proposal by NERSA.

NERSA’s decision not to hold public hearings on the proposed municipal energy pricing hike, according to the Democartic Alliance, is in violation of the regulator act and hence unconstitutional.

“Due to the limited ability of municipalities to absorb costs and cushion consumers against electricity tariff increases, the costs will be passed on to the consumer,” said the party’s shadow minister of mineral resources and energy, Kevin Mileham.

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