- High Court rules that Tshwane retains exclusive authority to distribute electricity within its municipal boundaries.
- Decision safeguards potential revenue of up to R125 million per month for the metro.
- R84 billion Mooikloof Mega City development expected to deliver up to 50,000 residential units.
The City of Tshwane has secured a significant legal victory after the High Court in Pretoria ruled that the municipality has the exclusive constitutional right to distribute electricity within the Mooikloof Mega City development, overturning a decision by the National Energy Regulator of South Africa (NERSA) and Eskom.
In a landmark judgment, Judge Anthony Millar set aside NERSA’s 2023 decision to amend Eskom’s electricity distribution licence to supply the large scale mixed use development in Pretoria East. The court found the decision to be unlawful, reaffirming the municipality’s constitutional mandate over electricity reticulation within its jurisdiction.
The dispute centred on the R84 billion Mooikloof Mega City project, a smart city development expected to accommodate up to 50,000 residential units. The project is regarded as one of the largest urban development’s currently planned in South Africa.
The ruling carries major financial implications for the City of Tshwane. Had Eskom retained the right to distribute electricity within the development, the municipality stood to lose an estimated R125 million per month in future revenue, a substantial amount for a metro facing ongoing financial pressures.
Judge Millar found that the land earmarked for the development already formed part of Tshwane’s licensed electricity distribution area. The court also noted that NERSA failed to consult the municipality before approving the amendment to Eskom’s licence.
NERSA and Eskom argued that electricity distribution is not an exclusive municipal function. However, the court rejected this interpretation, with Judge Millar stating that the Constitution clearly grants municipalities authority over electricity reticulation within their areas of jurisdiction.
The judgment is expected to have wider implications for future electricity distribution disputes between municipalities and Eskom, particularly as large scale urban and infrastructure developments continue to emerge across South Africa.
For the City of Tshwane, the ruling not only protects a critical future revenue stream but also reinforces municipal authority over energy distribution as the country advances efforts to modernise its electricity sector and support new urban developments.
Link to the full judgement HERE
Author: Bryan Groenendaal
