“The Chamber notes with concern that the latest fuel pricing adjustments (effective 04 December 2024) continues to penalise Nelson Mandela Bay consumers for the cost of hauliers transporting fuel via road from East London, due to the berth at the Port Elizabeth port not being operational.”
“It is our understanding that completion of the repair of the berth, which was planned for the 6th of December, has been revised to the 11th of December. It remains unclear however by exactly when the fuel berth will become fully operational again.”
“We estimate that since the rezoning of Nelson Mandela Bay as an inland zone in October of this year, an irrecoverable direct loss to the local economy of approximately R50 million per month has been incurred. Following tomorrow’s fuel price adjustment local consumers will accumulatively be paying R2.49 more per litre for 95 unleaded fuel, diesel and paraffin versus what they would have paid if the area was still a coastal zone.”
“It is our view that the additional costs incurred to date in transporting these fuels into the area by road has been unfairly passed on to businesses, consumers, commuters and local communities. None of these key stakeholders were consulted prior to the rezoning by the Minister of Minerals and Petroleum Products. Businesses, consumers, commuters and local communities have been made to bear the brunt of a shipping vessel accident, not caused by them, by paying inflated prices for fuel and indirectly for other goods and services.”
“We believe that this pricing structure is supposed to be temporary in nature, and that once the fuel berth is repaired, the area will return back to its former allotted zone. We therefore urge the relevant role players to accelerate efforts in this regard to ensure that Nelson Mandela Bay can be reinstated as a coastal fuel pricing zone from January 2025,” Van Huyssteen concludes.
Background information
The fuel berth at the Port Elizabeth Port was damaged in June of this year, resulting in industry hauliers having to transport fuel via road from East London to Nelson Mandela Bay.
The Department of Minerals and Petroleum Resources, in response to the additional costs associated with transporting the fuel to the metro, then decided to implement revised transport tariffs in October, November and now December 2024 for petrol, diesel and paraffin for Nelson Mandela Bay and surrounding areas. This resulted in interim zone changes in the affected areas, to allow the industry hauliers to recover their fuel transportation costs.
In the best interests of our members, consumers and communities, the Chamber took action by filing an urgent review application in October, to gain access to the information which informed the Minister’s decision and have since received the record of decision from the Department.
From the records received it would appear that the Minister did not consider any other options to mitigate the impact of the issue on consumers, but rather focused solutions on addressing the additional transport supply costs and the recovery thereof.
More over we remain concerned, that this potentially creates a precedent for the state to simply transfer its obligations to innocent parties without taking accountability and without regard to the right to administrative justice which is enshrined in our Constitution.
While we have achieved success in putting pressure on the Minister, as well as Transnet to accelerate the repair of the berth at the Port Elizabeth Port and return the metro back to being part of a coastal pricing zone, we are extremely disappointed that consumers and businesses continue to carry additional costs through the fuel price adjustments to fund this. It casts doubt that the berth, which is earmarked to be repaired by the 6th of December, may potentially not achieve this deadline.
As we are a non-profit organisation, the Chamber decided to reach a settlement with the Minister, whereby through a court order it has been agreed that Nelson Mandela Bay will revert back to being part of the coastal zone once the berth is operational again. The Minister was not willing to make this adjustment for the December fuel price adjustment, indicating the low confidence levels in the berth becoming operational timeously and which has since become a reality with the completion date being moved forward.
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