Overcharged whenever you fill up your prepaid meter? It’s just backdated service charges, says City Power

The recent installation of prepaid meters by City Power is causing some customers headaches as they complain about deductions that occur when buying electricity.

Customers have complained that the system deducts amounts each time they purchase electricity units.

City Power said on Monday that the concerns particularly come from customers who had meters installed during the KRN2 project rush in November 2024.

Deductions not overcharges – City Power

The power utility clarified that these deductions are not overcharges and are not caused by faults with the new meters.

“These surcharges are backdated service charges that have been accruing since the introduction of new tariffs in May 2024, with the service charge itself implemented from July 2024,” said City Power spokesperson Isaac Mangena.

The City Power system automatically calculates the outstanding charges for the previous six months and reconciles the meter data for each property for customers who got new meters.

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Mangena said for most residential customers, this amounts to a total of R1200 (excluding VAT) for the period between July and December 2024.

The utility explained that the system recovers backdated service charges by deducting a portion from every electricity purchase made by customers using newly installed meters.

“For example, if a customer buys R100 worth of electricity, the system will allocate not more than R50 depending on the debt towards settling the outstanding service charges, while the remaining amount will be converted into electricity units,” Mangena said.

Deduction continue until R1 200 is fully recovered

“This deduction process will continue with every purchase until the full R1200 (excluding VAT) has been recovered.”

The power utility said that customers will only become liable for the ongoing monthly service charge of R200 (excluding VAT) after fully paying the backdated service charges.

Mangena emphasised that the utility has added this R200 charge to accounts since the service charge was implemented in July 2024, and it will continue to accrue monthly.

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“Customers are encouraged to stay on top of their electricity purchases to avoid future accumulations of service charges,” he said.

City Power has urged customers who may be struggling with the service charges to apply for the Expanded Social Package (ESP). For eligible consumers, this program offers reduced service fees and free electricity allocations.

In cases where business customers spend less than R1500 on electricity, the system will not allocate electricity tokens until the basic service charge is fully paid.

Expanded Social Package

This process ensures that the utility recovers the required service fee before allocating additional electricity units.

“We regret any confusion or inconvenience this may have caused and appreciate your understanding as we address these matters,” Mangena concluded.