Power struggle surges on

Discussions on tariffs, solar power continue

The registration of solar power systems in Ndlambe is on hold until the municipality has engaged further with its residents, both on its controversial new tariffs, and its proposed small scale embedded generation (SSEG) dispensation. Meanwhile the Port Alfred Ratepayers and Residents Association (PARRA) has warned of massive economic fallout for local communities from the combined effect of staggering proposed tariff increases from both Eskom and the municipality. 

Resistance to tariff increases that have been described as “punitive” reached a peak at a meeting between municipal officials and residents on September 10 to discuss SSEGs. The meeting in the Port Alfred Civic Centre saw most of the 300-plus people attending walk out en masse, soon after the start. PARRA said the walkout was in protest against inadequate physical preparation to successfully engage with such a large group. Most of those present were Ward 10 residents.  

The Ndlambe tariff increases are set to affect paying customers in parts of Port Alfred and Alexandria; the proposed Eskom tariff hike of 36% will put further pressure on Ndlambe as intermediary to raise its tariifs, and will directly affect the national power utility’s direct customers who include consumers in Kleinemonde, Bathurst, Bushmans River Mouth, Boknes, Cannon Rocks and Kenton. 

On 28 June 2024, the High Court granted an order in terms of which national energy regulator NERSA’s mechanism for approval of municipal electricity tariffs was declared unlawful. Explaining the ruling to its members, the South African LocaL Government Association (SALGA) said the practical implications were that municipalities were not entitled to charge their end-user customers the electricity tariffs approved as part of their 2024/2025 financial budget unless these had been approved by NERSA based on cost of supply studies. Ndlambe Municipality appointed consultant Hendrik Barnard who conducted cost of supply studies and presented the findings and implications at ward based IDP imbizos earlier this year. 

But PARRA says Barnard’s presentation was never advertised as a public partition function. A report by committee member Dawie van Wyk quotes from Barnard’s report: “The COS study must now be workshopped internally and be approved by Council and then be submitted to NERSA. Once the budget process starts, the proposed tariffs need to be submitted to proper public participation.  Only once NERSA approval and public participation process is completed can implementation begin.”  

Van Wyk maintains that public participation was never done properly. He said that in a meeting with the PARRA electricity group earlier on September 10, Ndlambe Municipality had conceded this. 

“There is not a single notice on Ndlambe website or in the Talk of the Town specifically advertising this public participation on the New Electricity Tariffs,” Van Wyk said. 

Calling for transparency on how the new tariffs were arrived at, Van Wyk said, “Unfortunatley Mr Barnard’s 88 page report was full of technical jargon, complicated spread sheets that no normal reasonable ratepayers could understand. Never the less Council, without any detailed questions or discussions, approved the new tariffs.” 

Van Wyk added that NERSA had no jurisdiction on SSEG, including solar photovoltaic batteries and inverters. To support this, he quoted from NERSA’s letter to Ndlambe approving its request for a 13% tariff increase. NERSA said: “… the application [for approval of the SSEG tariff] …could not be approved because NERSA lacks… jurisdiction over the proposed activity between yourself and the [SSEGs].” 

Solar storm 

The new tariffs based on cost of use require consumers to select a maximum useage that will determine the rate at which they’re charged for power. What consumers pay is based on a combination of their installed capacity, and how much they use at what times of day.  While this caused consternation among residents, this was nothing like the outrage expressed at the new proposed SSEG dispensation. 

Van Wyk shared his calculations on a table comparing charges for a user with and without solar, with capacities of 30 Amps and 60 Amps respectively. 

According to those calculations, a SSEG generator with 30-Amp capacity would pay R517.56 extra in basic charges; a 60A SSEG generator R785.46 extra. 

“Not only are ratepayers being punished for having a SSEG (a massive 167.82% for a 30 Amp supply and 134% for a 60 Amp supply) but they have to register it or be cut off. Yet there are currently no proven systems in place to credit the ratepayers for exporting excess electricity back into the grid. They also have to purchase their meter from the municipality at a cost of around R 5,000.00,” Van Wyk said. 

“These huge increased tariffs aligned with Eskom’s proposed tariff increases are going to seriously affect many businesses in Ndlambe which would conceivably have to close due to high electricity costs and will result in retrenchment of their staff.” 

PARRA called for transparency from Ndlambe regarding how the solar and non-solar tariffs had been calculated, as well as proper public participation in the tariff determination process. 

Ndlambe Municipaity confirmed it would be meeting with PARRA and electricity consumers. In a statement from spokesperson TK Mtiki, Ndlambe said: “Ndlambe is going to engage with PARRA and the electricity consumers in this regard through a physical meeting and will communicate the agreed date soon. The deadline date for solar implementation will be determined after the engagement with PARRA and consumers has taken place. Further, Ndlambe is awaiting the agreed list of questions to be addressed in the meeting.” 

PARRA has asked residents to submit questions to them by October 6. In a post on its Facebook page, the organisation asked residents to address questions to secretary@parra.org.za and dawie@geocoal.co.za 

“Any changes to the present tariffs will have to be approved of at a special council meeting,” Van Wyk noted. 

In a separate initiative, Port Alfred guest house owner and vocal opponent of what he says are punitive year on year increases in the cost of services to residents, John Coster, is leading a group named Ratepayers Revolt. In a telephone interview with Talk of the Town, Coster said the main purpose of the movement was to call for fiscal discipline in municipalities. 

“The system is exploitative,” Coster said. “Both municipalities and Eskom are in a spiral of debt. To continue their role as benefactors and job providers, they are obliged to keep increasing their service charges. They have forgotten that their role is to provide affordable services for all.” 

  • This article was first published in Talk of the Town, October 3, 2024. The newspaper serving the communities of Ndlambe and the Sunshine Coast, with a weekly wrap of Makhanda news, is available at stores from early on Thursdays.