PG Group (Pty) Ltd and Others v National Energy Regulator of South Africa and Another

NERSA approved Sasol Gas Limited’s applications on 26 March 2013 for maximum gas prices, a trading margin, and transmission tariffs to apply after the expiry of a 10‑year regulatory agreement that had allowed Sasol to charge monopoly prices for imported Mozambican natural gas. Sasol Gas effectively enjoyed a monopoly in the piped‑gas market. The appellants, all large industrial consumers of gas, experienced substantial price increases (allegedly increasing mark‑ups from 227% to 398%) and applied to review and set aside NERSA’s decisions as irrational and unreasonable. The High Court dismissed the review solely on the basis of unreasonable delay, holding that the appellants should have challenged NERSA’s methodology determination made in 2011. The appellants appealed to the Supreme Court of Appeal.

The appeal succeeded with costs. The High Court order was set aside and replaced with an order reviewing and setting aside NERSA’s decisions of 26 March 2013 approving Sasol Gas’s maximum prices, trading margin, and transmission tariffs. Any subsequently approved maximum gas prices were ordered to apply retrospectively from 26 March 2014. Respondents were ordered to pay costs jointly and severally.

The case clarifies that preparatory or framework decisions by regulators—such as the adoption of a pricing methodology—are not independently reviewable administrative action unless they have direct external legal effect. It affirms judicial scrutiny over economic regulation, especially in monopoly markets, and reinforces rationality as a constitutional standard for regulatory pricing decisions.