NERSA allowing ‘ANC political gremlins’ in decision making to blame for Eskom tariff decision delay

Issued by Kevin Mileham MP – DA Shadow Minister of Mineral Resources and Energy
29 Nov 2022 in News

NERSA’s decision to postpone the announcement of its decision on Eskom’s tariff increase application has spawned credible speculation that it was a political decision taken by the regulator’s commissioners to ‘shield’ the ANC from public outrage, from what was expected to be a significant increase in the price of electricity.

To justify this unprecedented decision to delay the tariff increase announcement, NERSA blamed “gremlins that slipped into its calculations” for the postponement. For the discerning public, it would appear that the only ‘gremlins’ that slipped into NERSA’s calculations were the NERSA commissioners compromising the independence of the regulator to ‘accommodate’ ANC elections.

NERSA is supposed to function as an independent statutory body, as laid out in the National Energy Regulator Act, 2004. Its work must be free from any suspicion of political interference in order to preserve its statutory integrity.

Should it be established that its decision today to delay the announcement of Eskom’s tariff application was influenced by considerations for the ANC’s elective conference, the board and commissioners should be held to account. To dispel these concerns, NERSA should convene an urgent press conference within the next 24 hours to give the real reasons for the postponement, not the gremlin fairy tale that they gave.

NERSA missteps have been piling up of late after it recently missed its own deadline to announce a new tariff methodology to set Eskom and municipal electricity tariffs. Due to this delay, Eskom will have to continue determining Eskom tariffs according to the existing methodology where costing has to factor in cost of supply and ‘reasonable’ margins.

The DA still stands by its position that Eskom’s 32% tariff application is outrageous and should be scrapped. A week ago, we wrote to NERSA asking them to reject the entity’s tariff application request for the simple reason that the entity is unable to make a reliable supply of electricity and appears to have placed the country on an unofficial semi-permanent loadshedding schedule.

Unless NERSA makes a public announcement giving real reasons why it delayed today’s tariff decision, any subsequent decision that it will take going forward will be viewed with a cloud of suspicion. To preserve the regulators’ integrity and independence, it is important that NERSA commissioners come clean and be honest with members of the public.