South Africans Face Growing Energy Costs As Eskom Tariffs Continue To Climb

Steam rises at sunrise from the Lethabo Power Station, a coal-fired power station owned by state power utility Eskom near Sasolburg. Image credit: Reuters/Siphiwe Sibeko/File Photo

According to the Light Paper, what South Africans see on their monthly bill is not the true cost of electricity — it’s just the tip of a very expensive iceberg.

Controversial shift

Beyond the kilowatt-hours, GoSolr explains that the real cost includes generation and grid infrastructure, system losses, theft, non-payment, diesel-powered emergency generation, and wildly inconsistent municipal surcharges depending on where you live.

Then there are the invisible costs: damaged appliances, downtime, lost productivity, security expenses, and the growing 'private tax' South Africans pay for backup power.

Tariffs have increased by over 1,100% since 2007. A typical Eskom customer using around 800kWh per month paid roughly R1,055 in 2014; by 2024, the same usage costs about R3,388.

Eskom tariffs increased by 8.76%, followed by another 8.83% hike in April — with municipal customers often feeling it even more sharply once mark-ups are added.

Added to this is that the most controversial shift is the least talked about: the aggressive rise in fixed charges.

In plain terms, customers now pay significantly just to be connected, regardless of how efficiently they consume.

Using less electricity no longer guarantees meaningful savings.

Municipal tariff structures make things worse and are wildly inconsistent.

The Light Paper highlights how Cape Town has taken a more balanced approach with smaller fixed-fee increases and an opt-in time-of-use tariff, while Johannesburg shows how not to do it, with some customers facing fixed charges of up to R1,761 per month before using any electricity.

The pricing crisis also risks becoming a war on solar (and logic): South Africa desperately needs more distributed generation, yet current structures can discourage rooftop solar and batteries, add uncertainty, and punish the very behaviour the country should be encouraging.

The silent casualties are the middle class and SMEs, who are squeezed between repeated increases and limited options as the grid quietly starts to resemble a luxury.

Key take-outs from the Light Paper:

• Loadshedding may be down, but pricing is now the crisis — the honeymoon is over.
• Tariffs are up 1,100%+ since 2007; the bill is escalating faster than inflation and shows no sign of slowing.
• The bill isn’t the cost: add infrastructure, losses, theft, non-payment, diesel generation, municipal mark-ups - plus “invisible” private costs like downtime and backup power.
• Fixed charges are the new trap: consumers pay more just to be connected, so efficiency and self-generation are no longer properly rewarded.
• Municipal inconsistency = systemic inequality: tariff structures vary dramatically by city, with some households hit before they use a single unit.
• Distributed generation is being discouraged in places where it should be enabled - pushing South Africa into a slow-motion pricing “death spiral” as volumes fall and costs rise.

A different kind of failure

“South Africa’s energy system is under pressure, but it’s not beyond repair,” says Andrew Middleton, CEO at GoSolr.

“What we’re seeing now is the result of outdated pricing models that try to maintain the status quo and protect revenues, rather than embracing and enabling a rapidly changing energy landscape.”

South Africa has made real progress in stabilising its electricity supply. That should be acknowledged.

But stability without affordability is not success, it’s just a different kind of failure.

Right now, the system is sending the wrong signals, rewarding inefficiency and punishing progress, while quietly redefining electricity as something not everyone can afford.

If South Africa is serious about building a sustainable energy future, GoSolr believes these should be non-negotiable:

• Make tariffs transparent and predictable: focus on cost-reflective shifts and multi-year pricing certainty that doesn’t cause further volatility.
• Separate infrastructure from consumption costs: consumers should clearly see what they’re paying for.
• Standardise embedded generation rules - and simplify: solar and hybrid systems must be integrated, not penalised.
• Fix municipal funding models: reduce municipal dependence on electricity trading revenue by broadly reforming municipal finances.

“If we can align incentives, embrace distributed generation, and build a pricing framework that is transparent, fair, and future-fit, we can unlock a more resilient and inclusive energy system for everyone.

“This is not about choosing between the grid or private power. It’s about making them work together.

“If we get this right, South Africa won’t just stabilise its energy future; it can lead it,” concludes Middleton.

If you’re interested in the full GoSolr Light Paper, you can find it here.