An Eskom logo is seen at the entrance to their headquarters in Sunninghill, Sandton, Feb. 24, 2016. South African energy regulator Nersa said on Wednesday that it was considering a decision on rates charged by state-run energy company Eskom, has postponed to March 1 from February. 25 because it is looking for more clarity about diesel costs. REUTERS/Siphiwe Sibeko
The South African National Energy Regulator (Nersa) has given Eskom final authority to implement an average energy price increase of 18.65%.
Nersa stated that its decision on Eskom’s retail pricing and structural adjustment request was made at a meeting on March 10, 2023.
Eskom submitted a new proposal on March 2, 2023, with a lower increase for Homelight 20 Amp consumers.
Those who use Eskom Homelight 20A only experience an increase of 10%.
According to the environmentalist group Project 90 by 2030, Eskom typically supplies Homelight 20A to informal settlements and Homelight 60A to private homes.
Homelight rates are partially subsidized by Eskom and do not include capacity costs.
Capacity charges are fixed monthly payments paid by other Eskom customers for grid connections.
While Homelight 20A consumers would experience a significantly smaller price increase, Nersa authorized a 29.53% increase for essential industrial and urban customers.
Key industrial and urban customers will realize an increase of 18.65% plus an additional 7.37 cents/kWh to meet the subsidy, which increases from 5.69 cents/kWh resulting in an increase of 29.53 %,” it stated.
Nersa authorized an 18.49% increase in municipal rates.
It indicated that municipalities will have a lower increase than Eskom due to a mismatch in the fiscal year.
Eskom’s price increases will take effect when the new fiscal year begins in April, while municipalities are not allowed to increase their rates until July.
“In the first three months (April to June) of Eskom’s fiscal year, they will not experience an increase as their fiscal year starts on July 1 each year,” Nersa explains.
“The municipalities cannot increase their rates halfway through their financial year, because that would not correspond to the income to be achieved by the licensed municipal distributors.”
Nersa stated that the authorized prices do not include the government’s existing 15% VAT.
The table below provides an overview of Nersa’s authorized changes to the electricity tariff for the financial year 2023/24.
Nersa Approved Retail Rate Adjustment 2023/24Customer CategoryAverage IncreaseTotal Standard Rates18.65%Municipality — Jul 1, 202318.49%Eskom Direct CustomersMain Industrial & Urban: Megaflex, Miniflex, Nighsave Urban, WEPS, Megaflex GenOther Rate Costs18.65%Affordability Subsidy ( paid by industrial and urban Eskom customers)29.53%Rural: Ruralflex, Nighsave Rural, Landrate,
Landlight, Rurafex Gen18.65%Homelight 20A10%Block 1 (0–350kWh)10%Block 2 (>350kWh)10%Homelight 60A18.65%Homepower18.65%