Civic organisations and opposition parties are demanding that the City of Cape Town reduce the electricity tariff by 2,5% to adhere to the National Energy Regulator of South Africa (Nersa) guideline.
The City approved a 17,6% electricity hike that came into effect on 1 July, while Nersa approved a guideline ceiling increase of 15,1% for all municipalities.
Role-players that include Action SA, the Good Party, Al Jama-AH, Cosatu Western Cape, South African National Civic Organisation (Sanco), the Women’s Assembly Movement, the ANC and Stop COCT will join in a peaceful protest at the Cape Town Civic Centre on 26 August at 10:00.
“After numerous complaints to the City about the 17,6% tariff increase, members of the public and other role-players turned to Nersa for intervention,” says one of the conveners of the protest, Sandra Dickson of the organisation Stop COCT.
The same issue occurred in 2022 when the City applied for a 9,6% above guideline (7,4%) increase. A mediation process followed, the second and final mediation session being held on 9 June 2023 where both parties remained unpersuaded by the other’s stance.
On 6 June this year the City approached the High Court to overturn the Nersa decision on the 15,1% ceiling for the 2023 electricity tariff hike. This case was dismissed in the High Court of Pretoria on the matter of urgency with costs awarded to Nersa, according to documents available.
According to Dickson notwithstanding Eskom’s 18,6% increase to its direct supply users, Eskom’s users still pay a lot less than City users.
Dickson says the City has taken an immovable stance towards the public and Nersa on their electricity tariff hike for 2023-’24.
“At 17,6%, the hike is 2,5% higher than what Nersa has set the ceiling at. In light of the above the City of Cape Town left us no choice but to exercise the public’s right to protest. In the memorandum is a clear deadline by which the City has to respond as well as constructive proposals to remedy this untenable state of affairs.”
Hikes don’t allow City cost recoveries
The City’s stance on the City’s 17,6% electricity tariff hike – that was approved by council in terms of the Municipal Finance Management Act in May – remains unchanged.
According to the Mayco Member for energy, Beverley van Reenen, the City spends about 70% of its tariff income to buy electricity from Eskom, with the remaining 30% covering the costs of a reliable electricity service and plans to end load shedding.
In a recent statement to the media she said the City would suffer a budget shortfall of more than R500 million based on the Nersa guideline for tariff increases that does not allow for the City to recover its costs.
