Smaller complexes don’t make any gross profit, leaving no margin for operating costs – and the fewer the number of units, the bigger the loss. Picture: iStock A flawed decision by the energy regulator Nersa, and the unlawful implementation of tariffs, has put the electricity supply of thousands of flat dwellers in Ekurhuleni and the financial sustainability of their body corporates and electricity resellers at risk, according to the Electricity Resellers Association of South Africa (Erasa). Erasa is the latest in a long line of litigants asking for the court’s assistance over questionable tariff decisions by Nersa.
The court recently set aside Nersa’s determination of Eskom’s allowable revenue for the three-year period ending 31 March 2028 and, in another ruling, also its determination of municipal tariffs for the current financial year. Electricity resellers play a crucial role in the supply of electricity to residents in sectional title complexes. In many cases, these are low- to middle-income households but also includes some commercial and industrial owners and tenants.
This is mostly done on behalf of the body corporate, and in the case of Ekurhuleni, the municipal bill is in the name of the body corporate rather than the reseller. Resellers are by law not allowed to charge their end-users higher tariffs than those they would have paid if they had bought directly from the municipality. Their profit lies in the difference between the special bulk tariff at which they buy from the licensed distributor and the applicable retail tariff. It is therefore crucial that these two sets of tariffs are calculated with that in mind.
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