Cape Town Mayor Geordin Hill-Lewis has issued a powerful appeal to the National Energy Regulator of South Africa (Nersa), urging the immediate cessation of plans that would allow Eskom to potentially double its tariff increase, reports Cape {town} Etc.
The proposed hike, which could go as high as 10.5% annually over the next two years, stems from what Hill-Lewis claims are significant calculation errors in Eskom’s original tariff application.
The anticipated decision regarding the electricity tariff hike revision is set to be announced on 1 April this year, amidst growing concerns about the financial burdens placed on South African households powered by Eskom.
Hill-Lewis points out that Nersa’s calculations mistakenly allow for an extreme tariff jump from the initial 5-6% range, fundamentally altering the landscape of energy costs for consumers.
As the window for public comment on the tariff increase suggestions closed earlier this week, Hill-Lewis has been vocal in his objections. ‘We call on Nersa to immediately cancel plans to permit up to a 100% additional increase for Eskom over the next two years,‘ he stated. ‘Nersa should instead conduct a thorough, error-free assessment of Eskom’s financials,’
In his submission to Nersa, which is part of court-ordered public participation, Hill-Lewis provided data indicating that Eskom’s financial situation appears more robust than initially presented.
Recent interim financial results suggest that the utility has managed to generate significant profits even under its currently approved, lower tariffs. This revelation raises questions about the justification for such steep increases in costs that might unfairly burden consumers.
Alderman Xanthea Limberg, the City’s Mayoral Committee Member for Energy, echoed Hill-Lewis’ sentiments, highlighting the discrepancies in Eskom’s tariff application beyond just the calculation error.
‘Eskom’s improved financial performance, which can be attributed to higher electricity sales and or reduced operational costs, necessitates a comprehensive reassessment of the Multi-Year Price Determination,’ said Limberg.
‘It is essential that Nersa scrutinises all data provided by Eskom to ensure accuracy and verify information, especially given the impact on the cost of living for residents,’
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The Energy Regulation Act explicitly prevents Eskom from generating excessive profits through electricity sales, a rule bolstered by the need to ensure consumers do not shoulder the costs of inefficient operations.
With Nersa’s decision looming, South Africans are bracing themselves for the exact implications of their electricity bills in the coming years.
Following a truncated public commentary period that concluded on 21 January, the energy regulator’s final announcement is eagerly anticipated around the end of January.
Initially projected to be a modest 5.4% price increase in 2026, the proposed adjustments now threaten to explode into a staggering increase, potentially driven by billions of rands worth of miscalculations made by Nersa.
In late 2025, Nersa reached a settlement with Eskom behind closed doors, allowing the utility to collect an additional R54 billion from consumers due to these errors, a decision that has drawn widespread criticism and raised eyebrows about the regulatory body’s transparency.
Nersa has not publicly responded to the City of Cape Town’s assertion, leaving residents anxiously awaiting the repercussions of this looming decision.
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Picture: Gallo Images / Shaun Roy
