REGULATORY CLEARING ACCOUNT
Court allows Eskom to approach Nersa on tariff adjustments
The outcome has no bearing on tariffs as they stand, but will mean that in the future Eskom will ask for claw-backs from past years
Eskom can once again submit applications for tariff adjustments to the National Energy Regulator of SA (Nersa) through a mechanism called the regulatory clearing account, following a Constitutional Court ruling last Friday. In terms of the tariff-setting methodology, Eskom is able to retrospectively ask Nersa to claw back additional tariffs from consumers in the event that its costs were justifiably higher than anticipated when Nersa granted the original tariff application. If approved by Nersa, the claw-back is then added to the forthcoming year’s tariff. The methodology was thrown into doubt by a court ruling last August in which Nersa’s ruling on the 2013-14 regulatory clearing account application was set aside by the court because the regulator had not followed the correct methodology. That obstacle is now removed by a Constitutional Court ruling that affirmed a ruling of the Supreme Court of Appeal in June. The outcome has no bearing on tariffs as they stand, but will mean that...
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