‘Our models tariffs in best interest of customers’ – City Power

Johannesburg electricity supplier City Power said the utility models its tariffs in the best interest of customers.

City Power was responding to the High Court Gauteng judgment that energy regulator Nersa’s decision to approve its electricity tariffs for 2019/20 was irrational, irregular and unlawful, and set it aside.

High court judgement

The ruling came barely a month after the high court found the methodology Nersa had been using to set municipal tariffs countrywide for at least a decade is unlawful and ordered that it be set aside.

The court gave Nersa a year to develop a new methodology in compliance with the relevant legislation.

City Power spokesperson Isaac Mangena said they have taken note of the judgement.

“As an entity we continue to engage with Nersa and the South African Local Government Association (Salga) on a regular basis, and we will discuss the judgement and its implications. City Power models its tariffs in the best interest of our customers.”

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Tariffs

“Our tariffs are determined by the cost of our bulk purchases, and the cost to operate and maintain our distribution network,” Mangena said.

Mangena said customer are not paying their accounts in full.

“As things stand, most of our customers are contributing less to the network costs that City Power bears.”

“As an entity we always aim to be consultative in our approach through, among others, the Integrated Development Plan (IDP) process and other stakeholder engagements, and we follow the regulator-approved methodology by Nersa in determining our tariffs,” Mangena added.

Losing money

Earlier this month, the power utility said the City of Joburg loses in excess of R300 million a day due to load shedding.

City Power said it had secured electricity from alternative energy sources through short-term power purchase agreements of up to 36 months to keep the lights on.

The power utility also lamented that it was under tremendous pressure due to the backlog of outages across the City of Joburg.

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