The City of Johannesburg will not be introducing an electricity capacity surcharge which could have added more than R200 to the monthly bills of prepaid residential users even before they started consuming electricity.
This comes after the DA in early April accused the ANC-led metro of trying to sneak in the charge, which it said “targets the poorest of the poor” who were trying to save costs by switching to prepaid meters from conventional postpaid billing.
The opposition party’s caucus leader in the city, Leah Knott pointed out that the proposed tariff was approved as part of the city’s budget for the 2021/2022 financial year during a city council meeting.
A tariff document on the metropolitan’s website stated the charge was aimed at prepaid users so that they would “start making appropriate contribution to the cost of operating and maintaining the City Power electricity distribution network to be available on demand”.
The proposal was that prepaid users would be paying the additional R230 capacity charge per month, while businesses would be paying a further R460 per month starting in July 2021.
This would be regardless of the amount of power they consumed.
Civic organisation OUTA sent a formal objection to the city against the proposed levy.
OUTA legal project manager Brendan Slade said the city should produce a cost-of-supply study to substantiate its reasoning for the charge, as it would otherwise be irrational.
He provided examples to show how much more residents would have to pay per month should the charge be added in addition to the planned annual power consumption charge increase.
“For a household, the cost of buying 350kWh a month would increase from R596.17 to R913 – or by 53% – with the new levy,” Slade said.
“Using 500kWh a month increases [the bill] from R791.53 to R1,248.78 – or by 58%.”
“These charges are unreasonable and unjustifiable, particularly in the lower blocks,” said Slade.
While there had been reports that the city had dropped the charge, this was unconfirmed until recent official comment given to Times Live and eNCA.
City of Johannesburg MMC Jolidee Matongo told eNCA that the charge was suggested to ensure that all residents and paying businesses were paying for maintenance and repairs on the network.
“The users who are on conventional electricity systems, are already paying a surcharge. They are paying towards the maintenance and repairs of the electricity network,” Matongo stated.
However, after public consultation, Matongo said the city realised the economic conditions in the country were such that residents could not afford the charges.
It therefore decided to drop the implementation of the charge for the time being.
This is the third year in a row that the city has scrapped a plan to add the charge for prepaid users.
The city and its contracted waste management company Pikitup were also forced to withdraw a proposed R50 recycling levy after heavy resistance from the public and OUTA.
Despite the capacity charge not being added, the city has proposed increased electricity tariffs for all Joburg electricity from July, owing to the increased electricity prices Eskom charges to municipalities for the 2021/2022 financial year.
According to the current proposal, all energy charges (c/kWh) for conventional users will be increased by 14.59% except for the following customer categories, which will be charged at varied rates:
- Conventional business
- Large Power User Time of Use (LPU TOU)
- Residential Prepaid
Residential prepaid users will be paying 15.59% more per kWh of electricity.
The final increases will only be confirmed once tabled and approved by the council towards the end of May.