---
title: "Tariff retreat sets up Bay households for electricity credits"
description: "DA Eastern Cape leader Andrew Whitfield said the outcome extended beyond Nelson Mandela Bay and sent a message to municipalities across the country."
type: "NewsArticle"
publisher: "Daily Maverick"
site: "https://www.dailymaverick.co.za"
section: "FINANCIAL RELIEF"
author: "Kyran Blaauw"
author_url: "https://www.dailymaverick.co.za/author/kyran-blaauw/"
canonical_url: "https://www.dailymaverick.co.za/article/2026-08-04-tariff-retreat-sets-up-bay-households-for-electricity-credits/"
published: "2026-08-04T23:05:54"
lang: "en-ZA"
word_count: 1466
---

# Tariff retreat sets up Bay households for electricity credits

> DA Eastern Cape leader Andrew Whitfield said the outcome extended beyond Nelson Mandela Bay and sent a message to municipalities across the country.

By Kyran Blaauw · Published 5 August 2026, 01:05 SAST

## Key points
- The high court in Gqeberha orders Nelson Mandela Bay to reinstate the inclining block tariff (cheaper first 300kWh), apply it retrospectively from 1 July 2026 and credit households who’ve paid higher rates.
- The DA hails the ruling as a win after accusing the metro of secretly scrapping the cheap first block – many residents were reportedly paying 50-60% more despite being told the average rise would be about 10.95%.
- The municipality must obtain Nersa sign‑off on consequential amendments within 30 days (or as extended), automatically issue account credits within a further 30 days, and pay the DA’s legal costs – while reserving the right to fight the substantive case (Part B).
- Relief comes against a backdrop of a reportedly R1.5bn electricity deficit, widespread meter tampering and stalled amnesty replacements – employers warn escalating power costs are squeezing households and businesses.

## Content

Nelson Mandela Bay residents who paid higher electricity charges after the metro changed its tariff structure in July are set to receive credits after the Eastern Cape high court ordered the municipality to restore the previous inclining block tariff structure.

The order, granted by agreement in the high court in Gqeberha on Tuesday, directs the municipality to implement the changes retrospectively from 1 July 2026 and credit affected consumers for the additional amounts they have already paid.

The order followed an [urgent legal challenge](https://www.dailymaverick.co.za/article/2026-07-15-da-takes-nelson-mandela-bay-to-court-over-hidden-electricity-tariff-increases/)by the DA, which argued that scrapping the inclining block tariff resulted in substantially higher electricity costs for many households and that the impact of the change had not been properly disclosed during the public participation process.

Under the restored tariff structure, households will again pay a lower rate for the first 300kWh of electricity consumed each month before higher rates apply to additional usage.

The DA launched the proceedings after accusing the municipality of unlawfully introducing tariffs that left many households paying roughly 30% more despite residents being told during public participation that the average increase would be 10.95%.

[FOR CONTEXT

DA takes Nelson Mandela Bay to court over ‘hidden’ electricity tariff increases

July 15, 2026 ![Image](https://cdn.dailymaverick.co.za/i/V1H443JH2hHYyZsMJgz7o5ZCWkk=/450x0/smart/file/dailymaverick/wp-content/uploads/2022/01/Eskom-Des_1.jpg)](https://www.dailymaverick.co.za/article/2026-07-15-da-takes-nelson-mandela-bay-to-court-over-hidden-electricity-tariff-increases/)

Central to the dispute was the municipality’s decision to scrap the inclining block tariff system, under which households paid a lower rate for their first 300kWh of electricity each month before higher rates applied to additional consumption.

The DA argued that removing the cheaper first block significantly increased electricity costs for many households and that the full impact of the change was not properly disclosed during the public participation process.

The municipality now has 30 days, or longer if authorised by the court, to obtain approval from the National Energy Regulator of South Africa (Nersa) for the consequential amendments required to restore the previous tariff structure. It must then implement the changes retrospectively and allocate credits to affected consumers within 30 days thereafter.

### ‘Victory for residents’

Speaking outside court, Nelson Mandela Bay DA mayoral candidate Retief Odendaal described the order as a victory for residents struggling to afford their municipal bills.

“We brought this application which sought an urgent interdict to stop tariff increases, which saw the majority of residents in Nelson Mandela Bay paying between 50% and 60% more for electricity since 1 July.

“We believe that it was an unlawful tariff increase because the municipality indicated that the average increase was only going to be around 10% to 11%,” Odendaal said.

Odendaal said the municipality had initially opposed the application but, after filing its answering affidavit, its legal representatives indicated they were prepared to settle Part A of the application dealing with the urgent relief.

Under the order, the municipality must reinstate the inclining block tariff system that applied during the previous financial year, with retrospective effect from 1 July.

Residents who have already paid the higher tariffs will receive credits on their municipal accounts.

“It means that there will be more money in the pockets of people almost immediately.

“There are many people in the city that cannot make ends meet,” Odendaal said.

### Indigent households ‘hardest hit’

Odendaal said about half of Nelson Mandela Bay’s residents were living below the breadline and many indigent households had been hardest hit by the tariff changes.

DA Eastern Cape leader Andrew Whitfield said the outcome extended beyond Nelson Mandela Bay and sent a message to municipalities across the country.

“This was a huge victory. It sends a positive signal beyond Nelson Mandela Bay because it says the DA is fighting for fairness in the application of tariffs on the municipal budget.

“This is a socioeconomic justice issue, which will reverberate beyond Nelson Mandela Bay and into the echelons of power in other municipalities who will think twice before they try to smuggle in unlawful tariffs,” said Whitfield.

He said the biggest benefit would be that residents would receive money back through credits on their municipal accounts at a time when many households were under significant financial pressure.

![Andisa-Congress](https://cdn.dailymaverick.co.za/i/LVokQgMbeagw-1bHM9OVwzDpPOw=/200x100/smart/filters:strip_exif\(\)/file/attachments/orphans/Whitfield_151513.jpg)

*DA Eastern Cape leader Andrew Whitfield. (Photo: Andisa Bonani)*

Odendaal said it appeared that the municipality had implemented higher electricity tariffs to plug a funding shortfall in its electricity department, which he said was running at a deficit of more than R1.5-billion.

“The reality is that we’re sitting with an electricity department that is basically bankrupt and the only way that the municipality thinks they can balance the books is to ask the people paying for electricity to pay more.

“People can’t afford to pay a 30% increase. They could hardly afford the 10% increase that was promised to them,” Odendaal said.

According to Odendaal, the municipality had a collection rate of 70%, while he claimed that about 100,000 formal households had tampered with electricity meters.

### Amnesty programme abandoned

He also criticised the municipality for failing to follow through on a 2023 electricity meter amnesty programme introduced during the former DA-led coalition government.

Odendaal said about 21,000 residents had come forward during the amnesty to regularise their electricity connections, but had still not received replacement meters, depriving the municipality of potential revenue.

Odendaal said the 21,000 residents who had regularised their connections but not yet received replacement meters represented a significant potential revenue stream for the municipality that it was failing to collect.

Odendaal said the solution to the problems facing the department was to professionalise the electricity department, improve maintenance planning and recruit suitably qualified technical staff.

[LEGAL CHALLENGE

Small Bay businesses fight to survive ahead of electricity hike court battle

August 2, 2026 ![Image](https://cdn.dailymaverick.co.za/i/_AZKr940BBsBEuL3upFl-vMpPU8=/450x0/smart/file/dailymaverick/wp-content/uploads/2024/11/NMB-Electricity.jpg)](https://www.dailymaverick.co.za/article/2026-08-02-power-bills-soar-as-nelson-mandela-bay-heads-to-court-over-electricity-tariff-hikes/)

The Nelson Mandela Bay Business Chamber said the ruling was a “positive development” that would provide relief to both households and businesses already grappling with rising electricity costs.

Chamber CEO Denise van Huyssteen said the decision was particularly positive for informal businesses and domestic consumers.

“The average across-the-board increase of 10.95% is in itself not sustainable, given the successive massive double-digit increases over the past few years,” she said.

Van Huyssteen said the chamber remained concerned about the cost of electricity for all consumers, warning that escalating tariffs continued to undermine business confidence and economic growth.

“In terms of industry, electricity has become the biggest input cost for manufacturers operating in the metro, negatively impacting their competitiveness in the domestic and global market.”

![Andisa-Payment](https://cdn.dailymaverick.co.za/i/8dydJwhcM5i0X2AWxI-XKB7_rUU=/200x100/smart/filters:strip_exif\(\)/file/attachments/orphans/Screenshot2025-12-15at145307_748755_485995_651198.png)

*Nelson Mandela Bay Business Chamber CEO Denise van Huyssteen. (Photo: Facebook)*

The municipality has previously maintained that the tariff changes were adopted in line with the prescribed legislative and regulatory framework, following public participation and approval by Nersa. It argued that revenue generated through the approved tariffs was necessary to fund the operation, maintenance and upgrading of the city’s electricity infrastructure.

In a statement issued after the ruling, the municipality said it accepted the high court order and would implement it “diligently, transparently and within the prescribed timeframes”, including restoring the inclining block tariff, obtaining the necessary regulatory approval from Nersa and automatically crediting qualifying consumers once the process had been completed.

### Mayor accepts ruling

Bay mayor Babalwa Lobishe said the municipality had listened to residents’ concerns over electricity costs and accepted its constitutional responsibility to implement the court order.

“At the heart of this matter are the people of Nelson Mandela Bay. We recognise that electricity costs directly affect household budgets, pensioners, students, small businesses and employers. When residents expressed concern, we listened. When the Court provided clarity, we accepted our constitutional responsibility to implement its Order. That is what accountable government requires,” Lobishe said.

“Our commitment extends beyond legal compliance. It is about demonstrating responsible leadership, communicating honestly with our communities and ensuring that every qualifying domestic electricity consumer receives the benefit of the implementation process directed by the court.

“Residents rightly expect their municipality to lead with integrity, transparency and accountability. We accept that responsibility. Throughout this process we will continue placing the interests of our communities first while respecting both the authority of the courts and the constitutional principles upon which our democracy is founded,” she said.

![Kyran-NMBDrama](https://cdn.dailymaverick.co.za/i/74pyjXEgdQckBN0qKIg9UhMymz8=/200x100/smart/filters:strip_exif\(\)/file/attachments/orphans/WhatsAppImage2026-04-07at154652_103246.jpeg)

*Nelson Mandela Bay mayor Babalwa Lobishe. (Photo: Phando Jikelo / RSA Parliament)*

The municipality, however, stressed that agreeing to the interim relief granted in Part A of the proceedings should not be interpreted as an admission that it had acted unlawfully. It maintained that the tariff structure formed part of the municipality’s 2026/27 budget adopted by council following the prescribed budget and public participation processes, and said it would continue to defend the substantive legal issues before the court in Part B.

It also said qualifying consumers would not have to submit applications for credits, which would be processed automatically once the required regulatory approvals had been obtained and the technical implementation had been completed.

The court also ordered the municipality to pay the DA’s legal costs relating to the urgent application, including the costs of senior counsel. **DM**