South Africans Must Brace Themselves For Electricity Hikes This Winter
- Homeowners in South Africa could see electricity bills increase by up to 60% this winter due to new Eskom tariffs and higher winter rates
- Alumo Energy highlights that average consumption rises by 23% in winter, pushing bills significantly higher
- Many are turning to solar solutions to mitigate these costs and ensure energy stability amidst load-shedding.
Source: Getty Images
As South Africa braces for the winter season, homeowners are warned to prepare for significant increases in their electricity bills.
The municipal tariff increase set for July is a substantial 12.72%, following last year's 18.65% rise.
Managing Director of Alumo Energy, Rein Henkemans, says the combination of winter tariffs, the introduction of new Eskom electricity tariffs for 2024/2025, and a seasonal spike in energy usage could see bills soar as much as 60%.
Electricity price increase set for June
Henkemans said the situation is more alarming due to the traditionally higher winter tariffs municipalities impose from June to August, which can reach nearly 20%.
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This timing coincides with the annual tariff hike, aggravating household financial strain.
The National Energy Regulator of South Africa (Nersa) approved a 12.74% electricity tariff hike for the 2024/25 financial year, which will take effect on 1 April.
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Alumo Energy's recent case study, which examined changes in household electricity consumption over the past year, highlights the severity of the issue.
On average, households used 23% more electricity during winter, with some experiencing increases as high as 87%.
"Household energy use naturally increases during the winter as families spend more time indoors, run heaters for long periods, and as geysers work overtime to heat the colder water coming in."
The study noted that the heightened usage and tariff hikes significantly increase monthly electricity bills.
Heckemans said this could push households into higher tariff brackets, where each unit of electricity becomes substantially more expensive.
Potential effects on households
Alumo Energy presented two examples to illustrate the potential impact on household budgets:
"A household's consumption rises by 23% from 813 kWh in May to 1,000 kWh in June. With the winter rate increase, their monthly bill jumps from R1,650 to R2,430, an increase of R780. Following the annual tariff hike in July, the bill climbs to R2,740, representing a total rise of nearly R1,100 or 66.2% from May."
"A household using 2,700 kWh in the summer sees a 23% increase to 3,321 kWh in winter, pushing them into a higher tariff block. Their bill escalates from R6,220 in May to R9,000 in June, a leap of R2,780. With the annual tariff increase in July, the bill reaches R10,140, a total increase of more than R3,920 or 63.1% from May."
"These figures are fairly conservative. Some households could see their bills more than double during colder months after the new tariffs kick in and demand soars."
Switch to solar energy
The sharp price increases and the ongoing grid instability drive many South Africans to switch to solar energy.
According to Eskom's Generation Adequacy Report, rooftop P output has doubled in less than two years.
This trend is expected to continue as families seek to escape the grip of persistent load-shedding and rapidly rising grid energy prices.
"Homeowners with a hybrid grid and rooftop solar system can offset heightened demand and reduce the impact of additional winter tariffs and annual increases. They also benefit from having access to electricity even during load-shedding."
The report noted that the first household example could save approximately R571 per month in winter and R775 in summer with a customised solar package comprising a 5kW inverter, a 3.8 kWh battery, and 2.85 kWp solar panels.
The second household example could save about R2,860 in winter and R3,560 in summer with a 15kW inverter, 20kWh battery, and 11.5 kWp solar panels.
"This demonstrates the long-term value offered by solar systems. Despite the initial investment costs, they provide significant savings over time, with renting options starting from R1,299 per month making them more accessible."
"Homeowners no longer have the luxury of relying solely on grid energy or hoping for improvement. With prices soaring and winter approaching, installing a solar system makes more sense than ever to start benefiting from the savings."
Eskom electricity prices are set to increase next week
In a similar report, Briefly News reported that after Nersa's approval for the 2024/25 financial year, Eskom electricity prices will increase from Monday next week.
Nersa approved the electricity tariff hike in January 2023, affecting local municipalities and Eskom direct customers.
The embattled power supplier approached Nersa in October last year to request its retail tariff, structural adjustment application, and tariff schedule approval.
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Source: Briefly News
