Electrical power costs in South Africa are escalation at a rate significantly above inflation primarily, some say, as a
result of the ineptitude of Eskom and government policies which have resulted in insufficient generation capacity. This
capacity shortage necessitates additional income for new plant. Additionally, large supply contracts with new high energy
users, ostensibly to promote job creation, now operate at a major loss to Eskom.
Trying to determine the unit cost of electricity for a domestic household with a typical 60A supply from the published
Eskom rates and local municipality mark-ups is almost impossible given the plethora of rates and schedules. Therefore I
have resorted to the only truly reliable data available to me to wit, my municipality accounts. Using historical accounts
the data related to unit electricity costs was extracted and is presented in the figure above. This figure shows that in
the period 2009 to 2013 the unit cost of electricity increased by 170 per cent with annual increases of 26.1, 55.2, 23.3
and 11.7 per cent all of which are significantly above the published annual inflation rates for this period. It should be
noted that during the review period various other costs changed significantly e.g.-
- Fixed Charge
In 2006 there was a fixed charge of R54.78per month, which increased to R57.80 in 2007 and R79.34 in 2009 and finally
R102.60 from July 2009 to June 2010 at which stage it was discontinued.
- Service Charge
In July 2007 a service charge was introduced at R11.40 per month. This charge subsequently increased to R15.59 in 2009, R19.89 in 2010, R23.99 in 2011 and R26.33 in 2012.
- Free Power
From 2006 to July 2007 each household was allowed 50kWh free power.
Whilst it is true that South African once had one of the lowest unit cost for electricity (see above figure) the bottom
line is that the unit cost of electrical power in South African will continue to increase at a rate well above inflation.
It is this rising cost, in addition to the increased public awareness of the environmental impact of domestic power usage,
that will motivate South African consumers to strive to reduce domestic power consumption.