Msunduzi loses tariff war

2014-01-21 00:00

MSUNDUZI has been slapped down by the National Energy Regulator of South Africa (Nersa), ordering the municipality to reverse crippling tariff hikes imposed on city businesses.

Pietermaritzburg Chamber of Business CEO Melanie Veness read out a letter on the reversal, sent to her by Nersa, to a packed meeting at Chamber House yesterday.

She said the new letter was addressed to the municipality. In the letter, Nersa said the municipality was applying its tariffs incorrectly and that they must be changed.

The development comes as city businesses close or threaten to close under hikes that saw some charges rise by 900%.

The basic charges approved by the energy regulator had included the MCB or net ampere charge and they had only approved a seven percent increase along with other power charges.

But when the municipality sent out bills to businesses they massively hiked the basic charges by 900%, rising in some cases from an original amount of R49 to R661.

Nersa CEO Phindile Baleni wrote in the letter: “The basic charges that Nersa approved for these tariff categories is made up of the basic charge and the net ampere charges (MCB) applied for by the municipality.

“In light of this there is no need to charge net ampere charges (MCB) over and above the basic charges that Nersa communicated to you in the above-mentioned correspondence. This has always been the way that these tariffs were approved and communicated to you in the past and you implemented them correctly.

“However, in the current year the municipality implemented the basic charges and net ampere charges (MCB) separately resulting in double counting of the net ampere (MCB) charges.”

Baleni then went on to provide a table of charges that saw the commercial basic charges go right back to what they were before the hikes, less than R50 a month.

(See full table of the reversed charges above.)

Veness told the gathering that PCB met with Msunduzi muni­cipal manager Mxolisi Nkosi and his team early yesterday morning.

Nkosi confirmed the meeting with PCB and said he had indicated to them that he had received the new letter from Nersa.

“I told them that we will have to analyse the letter and seek further clarity from Nersa. The matter will also have to go before the full council meeting on Wednesday,” he told The Witness.

Veness said that in light of the letter, they had asked Nkosi to allow businesses to pay only what was due in terms of Nersa’s schedule and not the new inflated basic charges.

They asked that there be no disconnections for non-payment and that the back-dated charges be dropped. The municipal manager had told them that he could not respond until the council had con­sidered the matter.

Veness was asked what was going to happen to businesses that closed or who had indicated that they were going to close. She urged them to reconsider in light of Nersa’s instruction.

Meanwhile, protest action over the tariffs continues. A mass meeting is due to take place at 7 pm today involving downtown and northern suburb businesses and residents.

Organiser Dev Naidoo said trust has broken down and until they hear directly from the municipality on how it has interpreted the tariff reversal, they will continue with their protest action.

The meeting takes place in the Natal Blind and Deaf Society Hall in Olympia Way, Newholmes.

Naidoo said protest action to be discussed included:

•Petitioning the mayor, KZN MEC for Co-operative Governance Nomusa Dube-Ncube and Premier Senzo Mkhize;

•Embarking on a protest march and;

•Adopting a stance of civil dis­obedience.

He added the meeting will also discuss how tariff adjustments will be made, if the latest were to be reversed.

The ruling by Nersa also has implications for the city budget as the municipality had based it on a 10% increase.

“We need to know how this is going to affect services to the citizens of Pietermaritzburg,” he said.

• With last year’s tariff increases still up in the air, Msunduzi muni­cipality is getting ready to advertise its proposed rates and tariff increases for the 2014/2015 year.

There will be public hearings on the proposed increases from February 10 to 12. Details on the venues and times will be advertised.

Read Veness on tariffs: page 6

The tariffsNersa has insisted the city implement are:

Domestic Tariffs

*Domestic Single Phase (8OA)

•Basic charge: R18,375/month

•Net ampere charge (MCB) per amp per phase: R7,297

•Energy charge: 64,78c/kWh

*Domestic Three Phase (100A)

•Basic charge: R30,618/month

•Net ampere charge (MCB) per amp per phase: R5,380

•Energy charge: 66,01c/kWh

Commercial Tariffs

*Single Phase (8OA)

•Basic charge: R47,127/month

•Net ampere charge (MCB) per amp per phase: R15,356

•Energy charge: 67,85c/kWh

*Three Phase (100A)

•Basic charge: R84,508/month

•Net ampere charge (MCB)per amp per phase: R12,955

•Energy charge: 67,85c/kWh

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions. publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.