Tshwane wins Mooikloof Mega City electricity distribution battle

The court set aside Nersa’s decision granting Eskom the right to supply electricity to Mooikloof Mega City, a ruling that could see the metro gain an additional R125m per month in revenue. Picture: Gallo Images The City of Tshwane won a court battle against Eskom and energy regulator Nersa on Monday, potentially securing an additional R125 million per month in revenue for the cash-strapped metro. This follows a ruling by Judge Anthony Millar in the High Court in Pretoria, setting aside a decision by Nersa that granted Eskom the right to distribute electricity to the new Mooikloof Mega City in the east of Pretoria.

Mooikloof Mega City is a ‘smart city’ development being led by JSE-listed Balwin Properties. It was launched in 2020 by President Cyril Ramaphosa as one of 62 Strategic Integrated Projects (SIPs). At the time, the project was valued at R84 billion, with 50 000 sectional-title units planned in its first phase.

It includes, among others, the Greenkloof and Mooikloof Eco-Estate developments. The dispute over the lucrative electricity distribution business began in March 2022, when the metro, to its surprise, discovered that Eskom had submitted an application to Nersa about a year earlier to amend its electricity distribution licence so it could serve the smart city. The smart city was to be developed, among other properties, on the farm Rietfontein 375-JR, and Eskom requested that the farm be included in its licensed distribution area.

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However, the farm had already been included in Tshwane’s distribution area since 2011, and, under the regulatory framework, licensed distribution areas may not overlap. The area was largely undeveloped, and Eskom supplied electricity to the few farms in the area because Tshwane did not, at that stage, have the necessary infrastructure to serve them. “Customers receiving electricity from Eskom or any other licensed electricity distributor on the commencement date of this licence are excluded from this licence.” Tshwane objected to Eskom’s application before Nersa and emphasised that the farm formed part of the area covered by its distribution licence.

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