High Court rules Eskom price hike was “unfair and unlawful”

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The High Court in Pretoria yesterday set aside a judgement on the National Energy Regulator of South Africa (Nersa) and its decision to grant Eskom a fee increase of 9.4%.

At the beginning of March, Nersa granted Eskom the right to increase the price of electricity by the aforementioned amount for the 2016/17 period, which was almost half of what the utility company originally wanted. Eskom applied to have a tariff hike so that it could recover R22.8 billion.

After the fee hike was granted, a number of businesses, civil society groups and some mining companies took Nersa to the High Court, claiming that the hike would negatively impact their operations.

The Organisation Undoing Tax Abuse (Outa) was one of the organisations that took Nersa to court. Outa said at the time that it needed to know the details surrounding the granting of the price hike, before things can go ahead.

“In answer to Outa’s request to supply the public with the reasons for its decision to grant Eskom a 9.4% increase, Nersa has declined to provide details around their decision that gave rise to the implementation of the higher tariff,” Outa said in a statement.

According to Eyewitness News, the ruling by the High Court said that Nersa’s decision was irrational, unfair and unlawful.

After the judgement, Nersa said in a statement that it will be studying the ruling carefully.

“The National Energy Regulator (Nersa) today announced that it is currently studying and analysing the North Gauteng High Court ruling on its decision earlier this year regarding Eskom’s Regulatory Clearing Account (RCA) application for the first year of the Third Multi-Year Price Determination (MYPD3) period (2013/14 financial year),” it said.

“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,” it concluded.

Eskom on the other hand, added simply that it will wait for Nersa’s comments before proceeding further.

[Image – CC by 2.0/Peter Nijenhuis]



Charlie Fripp

Charlie Fripp

Charlie started his professional life as a motoring journalist for a community newspaper in Mpumalanga, Charlie explored different journalistic angles since his entry into the fast-paced world of publishing in 2006. While fostering a passion for the arts, Charlie developed a love for technology – both which allowed him to serve as Entertainment and Technology Editor for an online publication. Charlie has since been heavily involved in consumer technology for various websites and publications. He thoroughly enjoys World War II films and cerebral documentaries; aviation; photography and indie music. Oh yes, and he also has a rather strange obsession with collecting coffee mugs from his travels.