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The Supreme Court of Appeal upheld the appeal of National Energy Regulator of South Africa (Nersa) and Eskom including the costs of two Counsel, today, against a number of private companies within the Nelson Mandela Bay Metropolitan Municipality in a matter concerning the adjudication by Nersa of Regulatory Clearing Account (RCA) adjustment application made by Eskom in March 2016.
Heralding the positive outcome, Eskom’s Head of Legal, Suzanne Daniels, said: “The court considered whether in applying the price adjustment methodology (known as the MYPD), the decision by Nersa was rational, and whether the adjudication process and decision was unfair.”
“The court held that the development of the methodology does not preclude Nersa from applying reasonable judgement on Eskom’s revenue after due consideration of what may be in the best interests of the South African economy and public,” added Daniels.
Eskom’s interpretation of this ruling means that Nersa, in applying its discretion, may now consider the remaining RCA applications submitted by Eskom for financial years ending 2016 and 2017, which have been pending since the adverse judgment of the High Court that was handed down in August 2016. We will await Nersa’s guidance in this regard.
Eskom welcomes the judgement in that it creates the regulatory certainty in how our tariff is determined, which is a key concern of rating agencies and investors alike.
Issued by Eskom