No formal investigation into City tariffs

The City of Cape Town has ascertained that the National Energy Regulator of South Africa (Nersa) has not instituted a formal investigation into the City’s Nersa-approved electricity tariffs. This is after reports were first published in the Independent Media group that Nersa had started a formal investigation into the City’s tariffs. It would seem that the apparent insatiable appetite to criticise the City at any cost has led to the peddling of fake news. 

It appears that certain lobby groups and media outlets have contributed to the spreading of misinformation about the City’s Nersa-approved electricity tariffs. Complaints have been received about the tariff, which is to be expected as a matter of course however there is no formal investigation into the City’s tariff structure.

The City’s 2019/20 tariffs were approved at Council. Nersa approved the tariffs. Members of the public are encouraged to question the motives behind some lobby groups who continue to criticise the City and to misinform the public at large with fake news instead of sharing the facts that are made available in good faith. Civil society is an incredibly important sphere for engagement and to hold government to account. It is more effective when the engagements are based on constructive input.

The City’s 2019/20 tariff increases have been kept as low as possible at 8,88% compared to the 15,6% increase implemented by Eskom. Electricity prices are influenced by the fact that 65% of the tariff goes towards buying bulk electricity from Eskom.  

There is a perception being fuelled by certain groups that established themselves as lobby groups during the drought crisis that the City budgets to make a profit from service provision. The City compares well to other metros with costs being lower in many instances. Tariff income is not planned for profit.

Tariff information is available for all to see and the setting of tariffs is a process that is based on public participation. Importantly, there is still scope for reducing costs by reducing household consumption or being energy efficient.

The City has also made considerable provision for vulnerable households and the elderly through the provision of rates rebates and indigent relief for thousands of residents who are in need of assistance.

It is a pity that seemingly fake news is spread so easily without a proper interrogation of the content. It constantly leaves those who have to respond to fake news on the back foot and the truth becomes an ever more muddy territory.

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Issued by Greg Wagner, Spokesperson for the Executive Mayor Dan Plato, 20 August 2019