The National Energy Regulator of South Africa (Nersa) invites members of the public to submit comments on its consultation paper on 'Nersa Redetermination of Eskom's Sixth Multi-Year Price Determination (MYPD6) Regulated Asset Base (RAB) for the Generation Business for Financial Years 2025/26, 2026/27 and 2027/28'.

This is to comply with a High Court judgment received on December 21, 2025, which stipulates a closing date for consultation by January 21. Accordingly, the closing date for written comments on the consultation paper is January 21 at 16:00.

The consultation paper is available on Nersa's website.

The judgment ordered that Nersa redetermine the value of the Eskom RAB and the allowable revenue due to Eskom in respect of depreciation and then adjust the allowable revenue and Eskom average tariff for the 2026/27 and 2027/28 tariff years, after undertaking a stakeholder consultation process.

The judgment implies that the Nersa’s decision on Eskom’s allowable revenue application for the MYPD6 period has been reviewed and set aside especially given the fact that there is still uncertainty as to the correct RAB value, Nersa says in the consultation paper.

However, the reconsideration does not include Eskom’s Distribution business and the National Transmission Company of South Africa decisions and reasons for decision documents on the entire MYPD6 application.

The reconsideration only relates to issues which were before the court, namely the errors and miscalculations in the amount of R107-billion or less relating to the depreciation, the Eskom Generation RAB which is made up of the depreciated replacement cost, transfers to commercial operation, work under construction, net working capital and asset purchases.

The MYPD is a process of determining allowable revenues for Eskom. This approach is a cost-of-service, rate of return-based method with incentives for cost savings, efficient and prudent procurement by the licensee, namely Eskom. This is the process that serves as the basis for the determination of tariffs to various customer categories.

On June 30, 2025, Nersa received a notice of motion indicating that Eskom had lodged a review application with the High Court.

Eskom sought an order to review and set aside the decision published by Nersa on June 9, 2025, citing errors which resulted in its revenue shortfall for depreciation, RAB for its generation business, working capital and the treatment of depreciated replacement cost.

Eskom contended that the shortfall affected its allowable revenue for the 2025/26, 2026/27 and 2027/28 financial years, Nersa says in the consultation paper.

On July 25, 2025, the special Eskom Electricity Subcommittee considered the submission recommending the approval of a settlement of R54-billion between Nersa and Eskom to Nersa. Nersa made its determination on the settlement on July 30, 2025.

Upon approval of the settlement by the regulator, Nersa and Eskom applied to the High Court to make the settlement an order of the court.

Subsequently, the High Court made a judgment on December 21 on the matter.

Therefore, Nersa is embarking on a consultation process to redetermine Eskom’s allowable revenue in respect of the aspects that were before the High Court for review, including the RAB for Eskom’s Generation business, transfer of funds for assets ready for commercial operations, omission of depreciation amount on the decision table, depreciated replacement cost, working capital and asset purchases.