Eskom welcomes High Court decision that it proceeds with 9.4% tariff increase

APRIL 1, 2016

Eskom on Friday welcomed a High Court decision to dismiss the urgent application of the Organisation Undoing Tax Abuse (OUTA) to stop Eskom from implementing the approved tariff increase of 9.4% on 1 April 2016.

On Wednesday, the Nelson Mandela Bay Business Chamber announced that it had also joined the High Energy User Group (HEUG) - consisting of several energy intensive industrial companies based in Nelson Mandela Bay- as a co-applicant, in the launching of an interdict to stop Friday’s electricity hike, approved by the National Energy Regulator (Nersa). Read more on this, click HERE

In a statement, the power utility welcomed the Gauteng High Court decision made on Thursday. The application was dismissed with costs.

“Eskom is pleased with the decision of the court as this allows us to begin recovering the R11.2 billion revenue as approved by the National Energy Regulator of South Africa. We have cooperated with the legal process and we will continue to do so while also defending the process we have followed in the recovery of costs we incurred in the provision of electricity,” said Eskom’s Chief Financial Officer Anoj Singh.

The court decision means that Eskom’s electricity tariff increase becomes effective from today for its direct customers and 1 July 2016 for municipal customers.

The National Energy Regulator of South Africa (Nersa) last month announced that it had granted the power utility a 9.4% tariff hike for the 2016/17 financial year. The decision allows Eskom to recover R11.2 billion instead of the R22.8 billion it wanted in its Regulatory Clearing Account (RCA) application.