Prepaid Electricity Users Could Get Relief Under South Africa’s Proposed Pricing Overhaul

• Electricity Minister Kgosientsho Ramokgopa published a Revised Electricity Pricing Policy open for public comment from 28 August 2026
• The draft policy tasks NERSA with standardising prepaid vending fees and eliminating discriminatory tariff practices within 12 months
• Eskom and municipalities face new restrictions that could change how electricity costs are calculated and billed to consumers

SOUTH AFRICA — Electricity and Energy Minister Kgosientsho Ramokgopa has released a draft Revised Electricity Pricing Policy, inviting public and industry comment on proposed reforms designed to fundamentally reshape how South Africans are billed for electricity.

Published on 28 August 2026, the policy sets out a 10-year pricing outlook and introduces several protections targeting prepaid users, discriminatory tariffs, and inflated municipal charges. Stakeholders have 30 days from the publication date to submit written feedback on the draft.

Where prepaid users stand to benefit

According to a report, one of the most direct consumer protections in the draft policy concerns prepaid electricity vending fees. Under the proposals, NERSA would be required to develop a standardised pricing framework within 12 months to regulate the commissions and fees charged by third-party vendors, addressing concerns that prepaid users pay inflated service margins that are not reflected in the base tariff.

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The policy also instructs NERSA to remove what it describes as unauthorised discriminatory tariff practices within the same 12-month window. The aim is to ensure that customers in comparable categories pay rates that accurately reflect the actual cost of supplying electricity to them, rather than rates that vary without regulatory justification.

Eskom and municipalities face new limits

The draft introduces a significant shift in how utilities like Eskom recover costs from consumers. Under the proposed framework, revenue recovery will no longer be guaranteed where inefficiencies are identified. Costs arising from technical losses, electricity theft, and bad debt that exceed approved benchmarks will be excluded from the revenue base used to determine tariffs, placing greater accountability on the utility to operate within set standards.

Municipalities are also subject to tighter controls. The policy proposes national standards to prevent local governments from embedding hidden charges in electricity bills or using surplus electricity revenue to fund unrelated municipal services. Base tariffs would remain under NERSA's jurisdiction, while municipal surcharges would fall within the oversight of the National Treasury.

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Eskom unbundling continues

The revised policy further supports the structural unbundling of Eskom, with the stated goal of encouraging cost-reflective pricing and direct competition across the generation, transmission, and distribution segments of the electricity market.

More on South Africa's electricity costs

• Briefly News reported on smart geyser controllers that could help South African households cut their monthly electricity bills.
• Eskom recorded a second consecutive year of profit as the power utility's annual earnings more than doubled.
• Cyril Ramaphosa says South Africa must now tackle rising electricity costs after bringing load shedding to an end.

Source: Briefly News