At a meeting on June 30, the National Energy Regulator of South Africa (Nersa) decided not to approve Sasol Gas’s application for a clawback of R1.80/GJ/y for the difference in gas price between the approved maximum gas prices for the 2023/24 financial year and the gas price charged to customers for the period July 1, 2023, to December 31, 2023.

Moreover, it decided not to approve the level of trading cost applied by Sasol Gas, saying it was overstated and included unjustified costs relating to clawback.

Nersa has, however, approved Sasol Gas’s application for a maximum price of gas for the period from July 1 this year to June 30, 2026.

This entails the maximum price of gas of R87.04/GJ/y for end-user customers for the period from July 1 to September 30, which may be adjusted quarterly based on Sasol Gas’s verified cost of acquisition until June 2026; and the maximum price of gas of R82.69/GJ/y for third-party traders and resellers of gas for the period July 1 to September 30, which may be adjusted quarterly based on Sasol Gas’s verified cost of acquisition until June 2026.

Moreover, it entails a minimum of 5% discount from the maximum gas price be provided to third-party traders and resellers; and the quarterly adjustment of the maximum price with a three-month lag in its implementation until June 30, 2026.

Also, Sasol Gas must provide Nersa with cost and pricing information, on a quarterly basis, which demonstrates reasonable cost for the regulator’s monitoring and approval, whichever is necessary; and Nersa may review and subject the price adjustment to a compulsory consultation if there is a significant change in the cost of gas affecting the maximum gas price.

The approved maximum price is exclusive of the value-added tax.

The approved maximum prices of gas will remain effective until the date of approval of a new maximum price by Nersa.

The approval of Sasol Gas’s maximum gas price is a significant step, as it ensures fair pricing, affordability, and sustainability in the piped-gas market, the regulator states.

It mitigates limited competition, allows licensees to recover costs, and promotes industry development while providing affordable access to gas, it posits.