Eskom is proposing radical electricity pricing changes to significantly increase the monthly bill for South African households with solar power.<\/p>\n\n\n\n
The proposal would increase the fixed capacity charges, disproportionally affecting people using less electricity.<\/p>\n\n\n\n
The changes included introducing an ancillary service and network demand charge in the variable energy charges.<\/p>\n\n\n\n
Eskom first presented this plan to the National Energy Regulator of South Africa (Nersa) in January 2021.<\/p>\n\n\n\n
Simply put, Eskom wants to significantly increase network costs, which include transmission, distribution, and transformer costs.<\/p>\n\n\n\n
These network costs are recovered through variable (c\/kWh) and fixed (R\/kVA and R\/Customer) charges.<\/p>\n\n\n\n
Eskom said it wanted to move to a tariff structure with significant fixed daily network charges independent of usage.<\/p>\n\n\n\n
This means that South African households and businesses would have to pay a much higher fixed charge, regardless of whether they use electricity.<\/p>\n\n\n\n
This would lead to those with solar panels paying far more than before, as they would need to pay daily fixed costs to Eskom to be connected to the grid.<\/p>\n\n\n\n
At the time, Eskom said it was needed to prevent the loss of revenue from South Africans using solar panels to generate their own electricity.<\/p>\n\n\n\n
Eskom said South Africans who use solar power systems generate most of their electricity during the day.<\/p>\n\n\n\n
The power utility explained that this forces it to ramp up faster to meet evening demand, which affects the power system and incurs additional costs.<\/p>\n\n\n\n
The new electricity tariff plan also aimed to make Eskom\u2019s electricity more attractive than households and businesses generating their own power.<\/p>\n\n\n\n
Eskom\u2019s plan to increase its fixed charges, which will adversely affect solar users and other households with low consumption, remains in place.<\/p>\n\n\n\n
However, in its most recent published revision, the power utility acknowledged that it would increase low-consumption users\u2019 bills.<\/p>\n\n\n\n
Eskom\u2019s previous analysis of its proposed tariff changes showed that many households using less than 900kWh per month would pay more.<\/p>\n\n\n\n
\u201cIf the network costs were used as is, this would have resulted in significant increases to low consumption users, so some scaling was done to limit this impact,\u201d Eskom explained.<\/p>\n\n\n\n
To reduce the impact, Eskom said the generation capacity charge would initially be at a 50\/50 fixed-to-variable split in a phased approach.<\/p>\n\n\n\n
The power utility will gradually adjust this until it collects 100% of the generation capacity charge through fixed fees instead of variable costs.<\/p>\n\n\n\n
Although this proposal would initially cushion the price increase to low-consumption households, it will still increase their bills.<\/p>\n\n\n\n
Eskom did not publish its revised version for 2024\/25. However, the power utility did not show any inclination to change its stance on fixed and variable costs.<\/p>\n\n\n\n
An analysis by MyBroadband showed that Eskom customers who consume no electricity can expect to pay 321% more than they currently do.<\/p>\n\n\n\n
Those who use 100 kWh for a month can expect their electricity bill to increase by approximately 130% per month.<\/p>\n\n\n\n
It should be noted that Eskom\u2019s proposed changes to the electricity tariff structure have not been approved.<\/p>\n\n\n\n
The table below provides an overview of the proposed price change for the most common Eskom Direct user.<\/p>\n\n\n\n This article was first published by Daily Investor. Read the original here<\/strong><\/a>.<\/em><\/p>\n\n\n\nHomepower 4<\/th> Old Tariff<\/th> New Tariff<\/th><\/tr><\/thead> Network capacity charge per day<\/td> R5.04<\/td> R12.18<\/td><\/tr> Generation capacity charge<\/td> R0.00<\/td> R2.16<\/td><\/tr> Service and admin charge per day<\/td> R.00<\/td> R6.58<\/td><\/tr> Total cost before consumption per month<\/strong><\/td> R151.11<\/strong><\/td> R637.22<\/strong><\/td><\/tr><\/tbody><\/table><\/div><\/figure>\n\n\n\n
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