Electricity tariffs hike expected to dig into consumers’ pockets

South Africa’s electricity woes continue, and as the country battles loadshedding, electricity prices are expected to rise. The National Energy Regulator of South Africa (Nersa) has agreed to an 18.65% increase in electricity tariffs, which will take effect on April 1 of this year.

Eskom had requested a 32% tariff increase for the fiscal year 2023/24, which begins in April. In the same tariff application, the cash constrained power company requested an additional 22.52% increase for 2024/25. Nersa has granted Eskom a tariff increases of 12.74%.

In a statement, Eskom reflected on Nersa’s decision, saying that they appreciate Nersa’s tough decision for the 2024/2025 fiscal year revenue determinations and recognise the pressures this determination will place on consumers.

The Eskom CEO, Calib Cassim, commented on the decision. “Eskom notes the decision by NERSA. This decision will positively contribute from a financial and sustainability point of view,” said Cassim.

He continued and said, “The revenue determination of R319 billion and R352 billion for the financial years 2024/5 will allow a further migration towards a price level that reflects the efficient cost of producing electricity.”

However, the Assembly of the Unemployed (AoU), a South African movement for the unemployed, has objected to Eskom’s tariff increase.

“With more than 11 million South Africans being jobless, how does Nersa think we will be able to afford such steep tariffs?” the AoU asked in a media statement.

The AoU continued, “The public should not have to pay for ongoing corruption, mismanagement and Eskom’s wasteful expenditure. Eskom must accept responsibility for its own problems and come up with alternative solutions.

“It is perplexing that Eskom is failing to repair and maintain its existing fleet despite the fact that we are paying exorbitant electricity rates only to be subjected to extended load-shedding,” said the AoU.

According to the AoU, the government must invest in more sustainable, efficient, and cost-effective energy options such as solar and wind power and do so in collaboration with and through the public.

“We are calling on communities, organisations, and individuals to make their voices heard by protesting and challenging both Nersa and Eskom. Eskom is stifling consumers, especially the poorest of the poor, who are barely affording the current rates,” concluded the AoU.