A National Energy Regulator of South Africa (Nersa) decision to cap municipalities' surcharges on electricity will "not be taken lying down", Cooperative Governance Minister Sicelo Shiceka said on Wednesday.

"We believe Nersa has no locus standi on the matter," Shiceka said at a press briefing in Cape Town.

"We are not going to take this lying down. We believe municipalities must be able to have revenue."

Nersa, which approved an electricity tariff increase of 24,8% for 2010/11 last week, also gave the go-ahead for a municipal guideline increase of 15,33% for implementation from July 1, followed by 16,03% in 2011 and 16,16% in 2012.

A deadline of April 30 was set for the submission of municipal tariff applications.

But Shiceka said municipal surcharges were the responsibility of his department and the Treasury and not Nersa.

"We are preparing a meeting with Nersa. We believe they have gone beyond what is expected of them in relation of surcharges. It is not their terrain.

"It is going to severely hurt municipalities. Some are charging surcharges even up to 35%.

"If you tell them you no longer have the income that you used to have, it is going to have fundamental implications.

"That is why we are going to have to discuss and be able to find an amicable solution this matter with Nersa."

Shiceka said it was equally important that municipal surcharges "be transparent" and "open".
"People must know what they are being charged at this level," he said.