GOOD Press Statement by Anton Louw,
GOOD Cape Town Councillor Responsible for Finance
11 July 2023
The Good Party has submitted a formal request to the National Energy Regulator of South Africa asking them to reject the City of Cape Town’s astronomical electricity rate hike, that came into effect on the 1st July 2023.
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.
NERSA proposed that municipalities increase electricity tariffs by 15.1%, meaning municipalities will have to limit their increases.
Municipalities could however increase their tariffs higher than the proposed guideline if they had compelling reasons and a motivation to deviate.
The City of Cape Town and eThekwini Municipality are among six municipalities that applied to NERSA for electricity tariff increases above the NERSA guideline.
The City of Cape Town imposed an increase of 17.6% – way above the NERSA approved tariff hike for municipalities of 15.1%.
Following NERSA’s rejection of eThekweni’s proposed tariff hikes, the City of Cape town residents are now facing the highest tariff increase in the country – this while the City has substantial cash reserves.
Nersa ruled against the eThekwini Municipality’s proposed increase of 18.49% and only granted a 15.1% increase.
On the 30th June 2023, 150 units would have cost City of Cape Town residents R162 and on the 1st of July 2023 the same amount of units cost R190.
The City of Cape Town buys bulk electricity from Eskom and then re-sells it to the residents.
Eskom is now permitted to charge 173.80c per kilowatt hour (kWH), Cape Town, for example, charges residents between 298.30c k/WH and 362.72c k/WH.
That’s right: Cape Town households using more than 600 /k/WH per month pay more than double the NERSA regulated tariff.
GOOD understands that Municipalities must raise revenue in order to operate essential basic services, but in the current financial climate, with many citizens battling to feed their families, let alone pay for electricity, the mark-ups must be fair, affordable and just.
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.
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.
Media Enquiries:
Anton Louw, GOOD Cape Town Councillor Responsible for Finance
Cell: 082 377 3335
Email: anton@cisfs.co.za
Samantha Jackson, GOOD Acting Media Manager
Cell: 083 550 9875
Email: media@forgood.org.za