New 'fixed' utility fees here to stay, says City

IOL News

4 days ago

Some residents have reported deductions of up to R60 on electricity purchases of just R100.
Image: File Picture: Danie van der Lith/African News Agency
THE City has doubled down on its defence of the controversial fixed utility fees that residents say put further strain on already stretched budgets, with some reporting deductions of up to R60 on electricity purchases of just R100.
City customers now pay a fixed monthly charge of R59.90 (excluding VAT), known as the "Services and Wires Charge." This amount, since July 1, is applied as a daily rate of R1.97.
'(For domestic tariff customers) With each electricity purchase, customers pay for the number of days since the last purchase. Example: a customer buying electricity every 15 days will pay 15 x R1,97 = R29,55 in fixed charges (R59,90 for 30 days). Depending on the vendor, the fixed charge could be displayed as 'utility charge' or 'Service and wires charge' or fixed charge,' said City spokesperson, Luthando Tyhalibongo.
Home use tariff customers are being billed a monthly fixed charge of R339,89 (VAT excl.).
Public frustration over fixed utility fees began long before they took effect. During the 2025/26 Budget process, the public raised widespread objections warning that the charges would place an added burden on already struggling households.
The South African Property Owners Association (SAPOA) has also taken the DA-led City to court, challenging the lawfulness of the fixed charges and the City's decision to link certain fixed utility charges to property values.
The Cape Town Collective Ratepayers' Association (CTCRA) representing 56 ratepayer associations and civic organisations from across Cape Town is also supporting the application as Amicus Curiae.
CTCRA interim chair, Bas Zuidberg said: 'Home owners, especially the Home user category, have seen quite a steep increase from R245 to R340 per month for this fixed charge.
'The CTCRA has received more complaints about the fixed water charge, which is no longer connected to the size of the CoCT connection but is now linked to property values. We have also received many complaints about the new sewage fixed charge and the city-wide cleaning charge, which are also linked to property values.'
He said it was clear from the start that these charges were 'highly contentious'.
'More than 10 000 people signed a petition that CTCRA sent out to voice their objections. While CoCT did make a few changes these were not nearly enough to address the concerns. CTCRA is not against the imposition of fixed charges, but we believe linking them to property values is unlawful. Secondly we disagree with the city-wide cleaning charge, which we believe should be funded from the property rates. Thirdly the fixed charges should not be used as an additional revenue stream by CoCT, but they should (in conjunction with the variable charges) cover the actual maintenance cost for the infrastructure. CoCT has proven in the past (through the 'unregulated' portion of electricity consumption charges) not to adhere to this basic principle.'
Civic organisation STOP COCT has also received complaints from residents after noticing the added fixed charges on their municipal bills from July 1, most being outraged and saying that they simply could not afford them.
'The impact on households of the two new fixed charges (sanitation and cleaning) and the increase of 38% in the electricity fixed charge is very negative. In most households these fixed charges now total from around R500 upwards.
'According to the arguments in the Sapoa court case against the City of Cape Town, some of these fixed charges are outside the framework of the law. I fully agree with this argument and believe that the way the City implemented these fixed charges as new revenue streams only benefits the City. Many people are currently joining STOP COCT giving the reason that they have had enough of the tariff increases and the fixed charges,' STOP COCT founder, Sandra Dickson said.
However, the City maintained that the charges were a necessity.
'Tariffs include both a fixed charge and consumption charges. This means residents can save by consuming less, while still ensuring that all ratepayers contribute to Cape Town's infrastructure and fixed service costs. Fixed charges are common throughout South African municipalities and the world, and are a lawful means of ensuring sustainable infrastructure and service delivery. Following two rounds of meaningful public participation, the final revised budget not only protects households under R2,5 million as it was designed to do, but also expands relief to more homes including above this threshold as well,' Tyhalibongo said.
'Previously, all City-supplied customers made a contribution to city-wide cleaning services via the cost of electricity. Cleaning has now been removed from the electricity price. Customers therefore now pay less for electricity, and City-Wide Cleaning is now shown separately on the monthly bill under 'sundries'. It is not new City income but to cover existing costs beyond the refuse collection (under the refuse tariff for wheelie bins and dry recycling)."
Cape Times