ActionSA rejects over 40% electricity tariff increases that will devastate already struggling households
19 September 2024
South Africa is facing an escalating crisis. Persistent electricity tariff increases, compounded by economic stagnation and unemployment that has pushed our people deeper and deeper into poverty and despair.
Over and above Eskom’s outrageous request for a 36.15% tariff hike from customers, NERSA’s decision to allow Eskom to recover an additional R8 billion from its Regulatory Clearing Account will result in a further 4% tariff increase in 2025, bringing the total tariff increase to over 40% next year.
These combined increases will further devastate already struggling households, making basic electricity an unaffordable luxury for millions, straining businesses, and further weakening our fragile economy, with South Africans expected to pay 40% more for electricity.
From 2007 to 2022, Eskom’s tariffs have skyrocketed by 450%, vastly outpacing inflation, which increased by 129%. This disproportionate quadruple rise in energy costs has crippled household budgets, forcing South Africans to make impossible choices between paying for food or electricity. These escalating prices reflect the unchecked inefficiency of the Eskom monopoly, which continues to pass the cost of its corruption and ineptitude onto the public.
To make matters worse, unscrupulous municipalities are exacerbating this crisis by charging exorbitant electricity availability surcharges and tariffs.
The City of Cape Town, over the past two years has implemented excessive tariff increases far above what NERSA approved with 9.6% in 2022/2023 and 17.6% in 2023/2024.
These not only violate the terms of its distribution license but also place undue financial pressure on residents, while the City uses ratepayers’ money to fund its litigation battle to defend these unlawful increases.
So, while some publicly declare opposition to excessive tariff increases and run PR campaigns with petitions, their actions where they govern tell a different story.
In Buffalo City, massive increases in electricity charges have been introduced, including a 12% hike in electricity tariffs together with an excessive ‘cost of supply’ or availability surcharge, where prepaid customers will have to pay R432 per month, and post-paid customers will pay R763 per month
ActionSA firmly believes that this crisis demands far-reaching reform.
This demands that the planned tariff increases be immediately scrapped and ActionSA is committed to fighting for an energy system that is more affordable, stable, and sustainable.
To achieve this, Eskom’s operational efficiency must be improved, and we must decisively deal with cable theft, vandalism, illegal connections, extortion and most importantly, corruption!
Mismanagement at a municipal level is a major concern, and we need to crack down on defaulting municipalities and address inaccurate billing practices as these problems not only impact consumers but also affect revenue collection.
ActionSA believes that decentralising the energy market by capacitating and empowering municipalities to develop microgrids and renewable energy projects will reduce reliance on Eskom, promote competition among independent power producers (IPPs), diversify energy supply, and lower costs and alleviate the pressure on consumers.
ActionSA rejects these increases!
I thank you.
Issued by Malebo Kobe, Member of Parliament, ActionSA, 20 September 2024
