Energy regulator cleared to appeal high court ruling on Eskom tariff

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Eskom's CFO Calib Cassim said the company agreed that the matter would benefit from the decision of a superior court.
Eskom's CFO Calib Cassim said the company agreed that the matter would benefit from the decision of a superior court.
  • The South Gauteng High Court granted the National Energy Regulator of South Africa leave to appeal a decision relating to Eskom's tariffs.
  • Nersa had previously decided to deduct a R69 billion government equity injection from Eskom's allowable revenue, essentially the tariffs it could charge. 
  • In July, however the court set aside Nersa's decision, the regulator then applied to appeal the ruling.


The National Energy Regulator of South Africa has been granted leave to appeal a high court ruling which had set aside its 2019 decision on Eskom tariffs. 

In July, the Gauteng High Court of Johannesburg reviewed and set aside a decision by Nersa to deduct a R69 billion equity injection, from government, as part of the power utility's allowable revenue for three years - 2019/20, 2020/21 and 2021/22.

The high court instructed Nersa to reinstate the full amount to the power utility's revenue for the next three years, Fin24 previously reported. This means Eskom could increase its tariff to 128.24 cents per kilowatt hour.  

However Nersa launched an application to appeal the decision and last week the high court granted leave to appeal, the matter will now be brought before the Supreme Court of Appeal.  

In a statement from Eskom, the power utility's CFO Calib Cassim agreed that the matter would benefit from the decision of a superior court.

"It would be beneficial for a superior court to provide an order on the recovery of the misappropriated equity. Eskom is committed to a speedy outcome to this process as any further delay in resolving this matter continues to burden the economy of the country," the statement read.

In a separate statement issued by Nersa on Wednesday, it said the matter is of "critical importance", not only to the electricity supply industry but also to the broader economy and "for the creation of certainty to investors".

In the July ruling, Judge Kathree-Setiloane said the decision taken by Nersa on 7 March 2019 on the Eskom allowable revenue and tariffs for the three years between 2019/20 to 2021/22 was to be reviewed and set aside.

"A sum of R23 billion will be added to the allowable revenue already determined by Nersa for the 2021/2022 financial year. The average standard Eskom tariffs approved by Nersa for the 2021/2022 financial year will be increased by from 116.72 c/kwh to 128.24 c/kwh," said Kathree-Setiloane.

Kathree-Setiloane said after Nersa has determined the allowable revenue for Eskom for the 2022/23 and 2023/24 financial years, the regulator is directed to add a sum of R23 billion to the allowable revenue for each of those years.

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