The National Energy Regulator of South Africa (Nersa) has agreed to increase electricity tariffs by 18.65%, effective from 1 April this year.
Indebted power utility Eskom has won approval to increase tariffs by almost a fifth- the most in more than a decade- though that’s still below what it says is needed to help limit the worsening power cuts.
The national regulator allowed the company to increase tariffs by 18.65% for the 2023/2024 fiscal year, it said.
Eskom had applied for a 32% tariff increase for the 2023/24 year which starts in April.
In the same tariff application, the embattled power utility applied for a further 22.52% increase for 2024/25. Nersa has granted a tariff increase of 12.74% to Eskom.
The regulator said the “extremely difficult decision” sought to balance between the needs of Eskom and the consumer.
A court order required Nersa to make a final decision on the tariff by 24 December, but the regulator was granted an extension to Thursday, 12 January after its Electricity Subcommittee required more time to deliberate on 14 areas of concern.
South Africa has over two decades gone from having surplus power to regular load shedding.
Financial constraints at Eskom, which has R396 billion of debt, combined with operational challenges, caused the utility to impose more than 200 days of blackouts in 2022 to save the national grid from collapse.
The increase which is set to come into effect in April would be the biggest since 2011/12, based on the average of prices set for different sectors of the economy.
A spokesman for the utility said it would comment on the regulator’s decision on Friday.
Source: News24, IOL, Moneyweb, image from Twitter: @Action4SA