Important announcement for households with rooftop solar in South Africa

Nersa has approved rules for so-called “net billing”, which will see South Africa compensate renewable energy users, including households with rooftop solar.

The National Energy Regulator of South Africa (Nearsa) approved the long-awaited net-billing framework in December 2024, which allows businesses and households to receive credits for exporting excess electricity to the grid.

Under net billing, electricity generated from renewable energy sources, such as rooftop solar, can be fed back into the grid when there is a surplus. The new rules are now open for public comment.

The net-billing scheme’s eligibility includes, but is not limited to, facilities for the production of energy that use solar, wind, water, geothermal, biomass, biogas, biofuel, or renewable fuel cell resources.

According to Nersa, instead of receiving direct payments for the energy exported, customers get credits applied to their electricity bills, reducing future costs.

These credits are calculated using an export tariff approved by Nersa. Essentially, the grid acts as a “virtual battery,” storing excess power that can offset future consumption.

The introduction of net billing comes at a time when consumers are feeling the squeeze of rising electricity costs.

Nersa recently approved a 12.7% electricity tariff hike for Eskom for the 2025/26 financial year, adding to the financial burden on households.

Many have already turned to solar to mitigate these costs, with South Africa importing a record R17.5 billion worth of solar panels last year following the worst year of load shedding in history.

With the new rules in place, those interested in feeding excess power into the grid must apply through Eskom or their local municipality to ensure compliance.

This step is crucial for accessing export credits and integrating smoothly into the evolving energy landscape.

Not all sunshine for households with solar

However, while the introduction of net billing is a welcome development, not everything is sunny skies for households with solar.

Notably, Eskom has issued a stark warning to those with grid-tied rooftop solar installations to ensure their systems comply with regulations or face penalties after March 2026.

The power utility has emphasized that all small-scale embedded generation (SSEG) installations up to 50kW—including typical household solar setups of 5 to 10kW—must be registered with Eskom or Nersa.

Households that register their systems before March 2026 could qualify for exemptions from costly registration-related fees, including application, tariff conversion, and connection charges.

Eskom argues that the increasing number of solar systems feeding energy into the grid presents safety and performance challenges.

Ensuring compliance is necessary to protect the grid’s stability and the safety of workers maintaining it.

This stance has sparked controversy, as critics argue that not all rooftop solar systems should be classified as SSEGs—especially those that do not feed electricity back into the grid.

Some setups function like standalone generators, meaning they operate independently of Eskom’s supply.

However, Eskom maintains that any system running alongside its supply must be registered, regardless of whether it exports power or not.

The net-billing system and the looming compliance deadline create a mixed picture for South Africans with solar.

On the one hand, the ability to offset electricity costs through export credits is an incentive for more households to invest in solar.

On the other, the requirement to register and potentially pay additional fees down the line may deter some from adopting grid-tied systems.

Another solar boom

Despite these concerns, the new rules are expected to drive another wave of solar adoption as households seek energy security and relief from Eskom’s steep tariffs.

With load shedding still a reality and electricity prices rising, solar power remains an attractive long-term investment for many South Africans.

As the country transitions toward a more decentralised energy model, the net-billing framework marks a step forward in rewarding consumers who contribute to energy stability.

However, the challenge will be ensuring that compliance measures do not place undue financial strain on households, potentially discouraging further investment in renewable energy.

For now, South African households with rooftop solar can take advantage of the new net-billing framework to reduce their electricity bills.

However, they should also be mindful of Eskom’s compliance requirements and plan accordingly before the March 2026 deadline.

The future of solar power in the country looks bright, but navigating the regulatory landscape will be key to maximising its benefits.