Electricity price shock for Joburg residents

The City of Johannesburg (CoJ) has introduced new electricity tariffs for the 2019/20 period, including a nasty shock for prepaid users.

As of 1 July 2019, prepaid electricity users in the city will have an additional R200 slapped onto their monthly bill as a municipal surcharge attached to accounts.

This is above the rate increase for different usage blocks, starting at R1.39 per kilowatt hour (kWh) for residents using less than 350kWh a month, moving up to R1.82 per kWh for those using more than 500kWh.

While electricity tariffs in CoJ have increased by 13.07%, with the surcharge attached, prepaid electricity users could see their monthly bills increase by between 40% and 60%.

The table below outlines the changes:

2018/19 block Tariff 2019/20 block Tariff Change
Surcharge n/a Surcharge R200
0-500kWh 124.49 0-350kWh 139.42 +12.0%
350-500kWh 159.92 +28.5%
500-100 kWh 141.43 500+ kWh 182.23 +28.8%

Any consumption above 500kWh is also subject to a network surcharge of 6c/kWh, the city said.

Registered beneficiaries of the CoJ’s expanded social package are exempt from the charge, which includes properties valued under R350,000.

Other surcharges in South Africa

The R200 a month fee is similar to the ‘home user fee’ introduced in the City of Cape Town (CoCT) in 2018, where it applied a new network access and administration fee of R150 to prepaid users living in homes valued over R1 million.

For 2019, this tariff is set at R163.32.

When it implemented the fee in 2018, the CoCT said that the surcharge had to be implemented because of reduced use of electricity in the city. Smaller bills meant funds that were needed to subsidise power supply to poorer areas – which are factored into the unit cost – were decreasing.

A similar fee was also shoe-horned into bills in the City of Tshwane in 2019, with the city also attaching a fixed monthly fee of R200 per month.

However, in the City of Tshwane’s case, the billing has been challenged by AfriForum. According to the group, the charges faced by residents are unlawful, as the national energy regulator, Nersa, refused to approve the tariffs.

In Tshwane’s application to Nersa, the surcharge was noted at R120 per month, however the city is now charging R200. The city said that it was a ‘typo’ and the charge is actually set at R56. Nersa will hold public hearings this week on the new charges.

In eThekwini, the service charge is currently bundled into the unit price of electricity for pre-payment customers. Prepaid customers can expect a 13.1% increase in tariffs in 2019.

Read: Joburg water and electricity price hikes come into effect on Monday

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Electricity price shock for Joburg residents