Judul : Game-Changing Court Ruling to Curb South Africa's Secret Electricity Price Hikes
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Game-Changing Court Ruling to Curb South Africa's Secret Electricity Price Hikes
A new supreme court decision might significantly impact the determination of local electricity rates in South Africa. At the end of October 2025, the courtruledthat the procedure employed by theSouth African National Energy RegulatorThe decision by (Nersa) to determine annual electricity price increases was deemed unconstitutional as it hindered public involvement and breached the right to equitable administrative procedures.
This implies that the method by which local governments determine annual electricity rate hikes will undergo a transformation. All individuals utilizing electricity will now have the ability to view how these rate increases are substantiated. Local authorities will be required to release essential financial records that support these price adjustments.
Read more: South Africa's proposed 36.1% increase in electricity costs for 2025: the reasons behind Eskom's demand being considered unfeasible
The ruling also requires local governments to make long-term plans by establishing rigorous new time limits for tariff submissions.
Nersa serves as the governing body overseeing South Africa's electricity, gas, and fuel sectors. It is responsible for endorsing all bulk electricity rates suggested by Eskom, the government-owned energy company. However, it must also ensure this process is conducted openly, allowing for public participation.
The court determined that Nersa had not met this requirement. Its procedures were consistently delayed and opaque, leaving the public with limited opportunity to provide input on proposals to increase electricity rates.
Afriforum, an organization that advocates for South Africa's Afrikaner community, filed a lawsuit against Nersa because, over several years, the regulator had proposed significant tariff increases without publicly explaining these decisions.
For Nersa, the ruling signifies that it can no longer overlook regulations requiring it to engage with the public. It will also have to follow this process moving forward under a precise, court-imposed schedule.
I am a legal scholar whoresearches how the constitution promotes accountability, justice and rightsfor example, the right to fair pricingelectricity.
Read more: The power company in South Africa is seeking an increase in charges. It might not receive it.
I believe the high court rulingrepresents a win for openness and responsibility, as it tackles persistent issues within the system, including hidden decision-making processes and unrealistic timeframes for public feedback (such as allowing only one day for individuals to provide input on a proposed increase in electricity rates).
Essentially, it presents a rigorous new framework that may alter the method used to determine electricity costs.
Hiding essential details from the general population
Every year, South Africans are experiencing increasing power costs. For example, in April 2025, the state-run electricity company Eskom declareda 12.74% price increase.
These steep annual increasespose a financial strain on numerous families and companies.
Read more: The cost of electricity in South Africa is increasing rapidly. Why do demonstrations frequently become the sole means for individuals to express their concerns?
The procedure for determining the increase begins when Eskom submits its bulk electricity rates toNersa.
Nersa approves Eskom's bulk tariffs. Afterward, local authorities establish their own rates following Nersa's guidelines.By law, Nersa examines local utility rates based on a report that outlines the cost of producing and delivering electricity. It then releases the updated prices for public feedback, and only after that approves them. Local governments are not allowed to impose rates that have not been approved.
The court determined that this system was dysfunctional in reality. The first problemidentified by the courtwas that the procedure was regularly delayed. Nersa postponed informing municipalities about the updated Eskom bulk rate, causing municipalities to be late in submitting their own tariff proposals to Nersa.
This delay reduced the time available for public feedback to the point where, in some cases, there was no involvement whatsoever. Regulations under theAdvocacy for the Administrative Justice Actclearly mandate a comment period of no less than 30 days starting from the day the notice is released.
For instance, suggested increases in electricity rates for a specific region (Mogale City, home to 438,000 residents)were publishedOn 19 June 2025, and Nersa gave its approval the following day. This rendered public feedback unfeasible.
Read more: The cost of electricity in South African municipalities is negatively affecting the economy.
The court also determined that Nersa kept the cost-of-supply studies from the public, asserting that they were confidential. The public was prevented from accessing the single most crucial document required for providing a substantial comment. This is against the constitution since supply studies provided to Nersa by local governments are public records that should be available for public review.
The court also determined that Nersa had overlookedthe lawBy announcing the suggested tariff hikes exclusively on its website and social media. The legislation explicitly requires that the notifications be published in the Government Gazette and newspapers across South Africa, in at least two official languages.
What the court directed Nersa to do instead
The court provided mandatory instructions that establish a rigid, unchangeable schedule for all upcoming tariff approvals.
- By 31 January each year, Nersa is required to inform municipalities about the upcoming Eskom bulk tariff for the next year.
- Municipalities are required to present their complete tariff proposals, along with their cost-of-supply analyses, to Nersa by 30 March each year.
Read more: Judgment by the Constitutional Court marks a new chapter in energy regulation within South Africa
- The general population should be fully informed about the reasons behind suggested price increases. Hence, Nersa is required to release each individual municipal request for an electricity rate adjustment together with its cost-of-supply analyses.
- Ultimately, Nersa needs to complete its decisions and inform stakeholders by May 5th annually.
This updated schedule aims to eliminate the disorder, which the court referred to as ongoing tardiness, that has affected the procedure for many years. It will help guarantee that Nersa's rulings are finalized in time for local authorities to complete their budgets, which need to be submitted 90 days prior to the start of their 1 July fiscal year.
Why this matters to regular South Africans
This ruling enables regular citizens by requiring the release of cost of supply studies. This provides the public with the means to ensure their local municipalities are responsible. The law already includes provisions for public involvement in other municipal activities, such as Integrated Development Plans.
Even though studies have foundhowever, in reality, this involvement is frequently not effective; the electricity decision is significant as it marks the first instance where communities and specialists can examine the data and question: are our rate increases funding effective services? Or are they covering excessive salaries, electricity theft, and overall poor management?
Therefore, the ruling shifts the public from being passive payers of bills to proactive monitors. As active monitors, individuals will be able to ensure that increases in electricity prices are clear, prompt, and subject to public examination.
Felix Dube, Lecturer at the Department of Law, University of Venda
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Tagged: South Africa, Energy, Legal and Judicial Affairs, Southern Africa, Economy, Business and Finance
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