The National Energy Regulator of South Africa (NERSA) has released its approved electricity tariffs for all municipalities in SA for the 2016/17 period, which took effect on 1 July 2016. Next Renewable Generation (NrG) has consolidated and reviewed the increases in this document: Gauteng Tariff Heat Map.
NrG can conclude the increases were lower than the expected 12 – 16% range; the average across the eight Gauteng municipalities examined was 8.86%. This can be explained by the political factors involved, given that local elections took place in August 2016. However, the City of Tshwane and Midvaal municipalities could not escape the need for high inflation, with escalations of 12% and 14% respectively. NrG is of the opinion that these rates are required by Eskom, and will be increased further by municipalities, during the coming years to keep the utility in operation. Eskom has applied for 16 – 25% increases in the past few years, and NERSA’s power to curtail these must be aligned with the utility’s best interest.
The electricity tariffs in South Africa are still amongst the lowest in Africa and the world, and our utility is battling to maintain and build power plants. Brace yourself for a quick catch-up in pricing that will change your operating expenses from a necessary inconvenience, to a crippling game-changer. Protect your business and contact Next Renewable Generation for a private power solution.
Our typical clients, in the industrial and commercial space, fall in the industrial Time of Use structures of most municipalities. As such, these have been selected for this case study. The proportional increases are generally representative of the quantum of inflation across the board. The weighted average tariffs shown were calculated using a specially developed model that weights the tariffs according to a typical solar photovoltaic (PV) yield throughout the day and year.