Hopolang Mokhopi
THE High Court will on 2 June 2026 rule on the legality of the Lesotho Electricity Company’s (LEC) electricity tariff increase for the 2024–2026 period.
Justice Polo Banyane reserved judgment this week after hearing arguments from LEC and human rights group Section 2, which is seeking to have the tariffs set aside and consumers refunded. LEC, however, argued that the matter is moot and based on a misunderstanding of the law.
Section 2’s case hinges on whether LEC submitted the correct financial statements to the Lesotho Electricity and Water Authority (LEWA) when applying for the tariff review that led to the 2024 increase.
Counsel for Section 2, Advocate Fusi Sehapi, argued that the Companies Act obliges LEC to use its most recent audited financial statements before seeking a tariff hike.
“In order to justify its request for increments, LEC ought to have finalised its latest financial statements,” Adv Sehapi told the court, citing Section 94(1) and (2) of the Companies Act.
He said the law requires accounts to be completed within three months of the financial year-end and finalised within six months.
According to the applicants, the latest statements submitted by LEC were for the year ended March 31, 2022.
“They were outdated financial statements,” Adv Sehapi argued.
Section 2 also argued that the tariff hike was implemented without proper public consultation, in breach of Section 5 of the LEWA (Electricity Price Review and Structure) Regulations 2009, which requires engagement with stakeholders.
“Absent the latest financial statements, which must inform tariff adjustments, the increment was not transparent,” Adv Sehapi argued.
He asked the court to set aside the tariffs and order refunds to consumers, either directly or through electricity credits.
However, the court questioned the applicants’ position on timelines, noting that when LEC was requested to submit statements on 2 February 2024, the 2023–2024 financial year had not yet ended.
“You wanted financial statements for a year that had not ended. Perhaps you were asking for something that did not yet exist,” Justice Banyane remarked.
Appearing for LEC, Adv Kabelo Letuka argued that the utility company had complied fully with the Tariff Filing and Review Procedure established under the regulations, which specifies the documents required for such applications.
“The authority has the power to request from the licensee any financial or other information it considers necessary for the review,” he said.
He explained that applications submitted in 2023 would typically include management accounts for 2022 and 2023, alongside audited financials for earlier years.
The defence further stated that all requirements were published in newspapers on January 18, 2024, and made available on the authority’s website before Section 2 made its submissions on 2 February 2024.
“They made their presentations fully aware of all the required documents,” Adv Letuka said.
On the issue of audited reports, he argued that the applicants placed undue emphasis on audits.
“They are fixated on the word ‘audited’. An audit merely verifies what is already contained in management accounts, and they have not shown that those accounts are inaccurate,” he said.
Adv Letuka added that the legal threshold for review is whether the decision was grossly unreasonable, which he said had not been demonstrated.
“It has to be grossly unreasonable, and that case has not been made by the applicant.
“Setting aside the tariffs at this stage would have no practical effect,” he said, adding that the applicants had not sought alternative relief.
He warned that nullifying the tariffs without a replacement framework could create regulatory uncertainty.
“There can never be an end to this process if we insist on waiting for audited reports before every application, as the process itself extends into the next financial year,” he added.
LEC implemented the contested tariffs in June 2024 for the 2024–2026 period. Section 2 filed its application shortly thereafter.
Justice Banyane is expected to deliver her judgement on 2 June 2026.
