Kensington residents are gearing up for a legal battle for the continued supply of piped natural gas after Egoli Gas - the only service provider in the area - recently informed residents of their intention to leave the area, citing business reasons.
Natural gas has been a credible alternative to South Africa’s load shedding crisis for some fortunate communities, including residents of Kensington, who have used it to run their gas geysers, stoves, heaters and other appliances in their homes.
Angry residents held a meeting last Thursday night, which was also attended by a few City of Johannesburg councillors and members of the community, where they expressed a determination to take the fight to Egoli Gas, which is a private company with approximately 1,200 kilometres of underground pipeline network in the Greater Johannesburg City Council boundaries.
Donovan Williams, who is a spokesperson for the affected residents and an executive member of the Kensington Community Association (KCA), said they were intending to interdict Egoli Gas from terminating their services in the area.
Egoli Gas aims to leave the Kensington area by November, with residents incensed that the company was offering a mere R3,000 rebate to help them switch to electrical appliances. They said the offer was an insult.
One of these residents is Brett Anderson - also a KCA executive member - who spent close to R40,000 on setting up a gas geyser installation and piping as recently as January this year.
In less than a year, Anderson’s investment on piped natural gas has come back to burn him, as he received a notice from Egoli Gas dated September 6, 2023, advising that they were terminating their services in his area due to a “commercial assessment of the viability of supplying gas to the area”.
A disappointed Anderson said: “A lot of us invested to go for gas geysers because of the electricity situation ... We are in the middle of an electricity crisis, so we invested.”
Anderson said getting his house gas-ready cost him R37,000, spending R15,000 on a gas geyser, R11,000 on a one inch pipe which connected the house to Egoli’s pipeline, and a further R11,000 on a water pipe installation.
“I invested in January because I thought I was being a responsible citizen,” he said.
He said the investment had appeared to be paying off, with savings of about R1,000 per month after cutting his electricity bill of around R6,000 down to about R3,000, while he was paying Egoli Gas about R2,000 monthly for gas.
“From a grid point of view, it is a responsible thing to do. This helps take the load off the grid,” he said.
Anderson said many Kensington residents had made similar investments and the decision by Egoli Gas was unfair on residents.
IOL sent Egoli Gas 11 questions regarding this matter, but they failed to respond to at least a third of the questions.
Egoli Gas spokesperson, Ewa Fabris said the events of the recent Joburg CBD gas explosion had nothing to do with their decision to terminate their services in Kensington.
“Egoli Gas is indeed desirous of exiting the market in the Kensington area in line with the termination notices issued to our respective customers. While we greatly appreciate and value our customers, the decision to exit the Kensington market is based on sound commercial reasons, and has not been taken lightly.
“You will appreciate that our commercial rationale for exiting the area is sensitive and proprietary in nature,” she said.
Kensington's ward 66 councillor, Carlos Da Rocha, in a text message sent to irate residents, said he had been told by the company that “the pipeline for the gas is over 80 years old, and it is no longer financially feasible to supply certain areas with gas”.
He did not respond when approached for comment.
On complaints about the R3,000 rebate, Fabris said: “we appreciate that many of our customers may be disappointed with our decision to exit the area, the payment of R3,000 per customer was an ex gratia/good faith proposal with no underlying obligation to offer the same.”
She also said they had not been invited to the community meeting last week, but the KCA disputed this.
“We were merely informed that a meeting was scheduled. We did provide answers to questions that were posed.
“Although the threat of further legal action by the community is unfortunate, we will protect our rights as may be necessary to the fullest extent. We trust that it will not be necessary to proceed with further legal action,” said Fabris.
Egoli Gas did not respond to the following questions posed to it:
- How many homes does Egoli Gas serve in the Kensington area?
- How much has Egoli Gas invested on infrastructure maintenance in the last three financial years?
- Is your spend on infrastructure maintenance adequate?
- Egoli Gas is said to be expanding it's operations in newer wealthier communities in the north such as Waterfall. What is the differentiation point between serving new customers and foregoing old ones closer to the Joburg CBD?
Fabris was notified of this and did not respond.
Da Rocha told residents via text message he was under pressure from residents but he could not “influence Egoli Gas to keep on providing gas for the area.
“I myself believe that this is a very ratty thing to do, in such short notice, and the fact that gas is somewhat providing relief during load shedding makes this case even worse.
“As I am your leader I have intervened and called Egoli. I did explain to them that shutting down the supply was going to cause hardship to many residents,” said Da Rocha.
He said as the gas company was privately owned and run, they could not “carry this fight forward”.
Anderson said it was a travesty that Kensington, which has had gas since 1920, could be losing the gas.
“Who will be next? Orange Grove? Houghton? Hillbrow? Berea?
“Is it your LSM category that determines if you get switched off or not?” Williams asked.
“This fight is not going to go away. They think they are just going to ride out the storm, ignore us and frustrate us. That is why we want to get an interdict,” said Williams.
The residents said they were prepared to fight and would not simply roll over because the battle was against a private company.
IOL