Joburg to start paying for excess solar power from residents – these are the rates

Joburg power utility City Power says that it is working on implementing feed-in tariffs in the city, where customers with PV solar systems can feed back their excess power to the grid and reduce their monthly electricity bills.

A residential embedded generator is approved for 85.50 c/kWh, and for business and Large Power User embedded generator (<=1 MW) is approved for 70.85 c/kWh.

The move to pay solar users for excess electricity follows similar measures introduced in the City of Cape Town in June. Feed-in tariffs for residential generation in Cape Town is expected in 2024.

City Power did not indicate when the feed-in tariffs would take effect, but the move forms part of a bigger strategy to open the grid to third parties.

Last week, councillor for the Johannesburg Mayoral Committee for Finance, Dada Morero, announced that the City of Joburg was shifting away from being an electricity distribution entity to an energy service provider.

To do this, the city council approved generator-use-of-system tariffs, which allows independent power producers to use existing grid infrastructure to supply customers.

“The tariff will be applicable to generators of electricity who may want to service customers embedded within the City Power area of supply but will be charged to their respective end customers,” the city said.

“The tariff will also be applicable to customers who self-generate electricity for use at a location elsewhere on the City Power electricity distribution network.”

Isaac Mangena, Senior Media Relations Manager at City Power, told BusinessTech that City Power will still charge the customer for all electricity supplied; however, it will credit the customer with the electricity supplied by the third party at Eskom’s Wholesale Electricity Pricing System (WEPS) tariff.

“Allowing customers to source electricity from third parties will displace the current revenue margin on energy (kWhs) sold, while the demand charge is not fully cost-reflective.

“The network access charges should therefore be proportional to the opportunity cost (as may be discounted) of providing third-party access to the City Power network,” Mangena said.

“It is therefore proposed that City Power charges the customer for all the electricity supplied to the customer and credit the customer with electricity supplied by the third party at the Eskom WEPS tariff.”

Read: Prepaid electricity price hikes in Joburg – what you’ll be paying from this month