GOOD party wants CoCT to lower its electricity price hike of 17.6%

The GOOD party wants the National Energy Regulator of South Africa (Nersa) to reject the City of Cape Town's electricity tariff hike of 17.6%, which came into effect on 1 July 2023.

Eskom increased its tariffs by 18.65% for the 2023/24 financial year.

Municipalities could however increase their tariffs higher than the proposed guideline of 15.1%. NERSA rejected eThekweni municipality’s proposed tariff hikes of 18.49%, and was only granted a 15.1% increase.

PICTURE: Pixabay

GOOD party councillor Anton Louw said NERSA should do the same for the City of Cape Town

‘’It is time for the City of Cape Town to show leadership, dig deep into their budgets and do what they can to assist hard-pressed consumers. Even if the city had to apply a zero percent increase, it will still make a surplus due to the big difference in revenue and bulk purchase of electricity,’’ said Anton Louw, GOOD Cape Town Councillor Responsible for Finance.

‘’Now is the time for Mayor Geordin Hill-Lewis to lead by example, follow his own advice to ESKOM, and, dig deep into their budget, weed out historical but non-essential allocations, and give the people a break. In the end, we have a duty to provide services efficiently and reliably, and to ensure they are provided affordably to everyone, with support for those households and individuals that need it most,’’ he added.

The City of Cape Town has defended its recent electricity tariff increase. The municipality said that Nersa's tariff guidelines had already proven to be unlawful and invalid.

Mayco member for Energy, Beverly van Reenen, said the key issue remains the Eskom tariff hike of 18,5%.

‘’ Nersa’s tariff benchmarking methodology has already been reviewed and ruled unlawful in two High Court judgments. Nersa is applying the benchmark methodology now for the last time.

‘’The City would run an estimated budget shortfall in excess of R500 million based on Nersa’s guideline tariff increase. This shortfall would make it impossible and unsustainable for the City to run a reliable electricity service and implement plans to end load-shedding,’’ added van reenen.

In response to van Reenen, GOOD party’s Anton Louw maintained its call that Nersa must intervene and stop the City of Cape Town from placing a tariff hike.

‘’The comments made are laughable and shows how out of touch the DA is with the daily realities faced by the city’s poor and middle-income households. By her own admission the city would run a loss of R500-million if they implemented the proposed 15.1% hike. What she fails to mention is the city is sitting with a surplus of just under R10-billion in the bank. Municipalities must raise revenue in order to operate essential basic services, but they do not need to run at a profit.’’

‘’ The original proposal by Nersa was for an 18.6% increase. At the time the city then reduced their increase to 17.6% and told Capetonians that the city in effect would subsidise the difference. However, when Nersa released their final 15.1% increase, the City of Cape Town did not align their increase like most other municipalities. This is a big blow to residents, especially poor and middle-income households,’’ added Anton Louw, GOOD Cape Town Councillor Responsible for Finance.

Louw described the increase as unfair, unaffordable and unjustified.

According to EWN, NERSA could take about four months to finalise its investigation into the City's tariff increase

Done By: Mitchum George