Proposed increase for municipal electricity tariffs – SA can no longer afford Eskom

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Proposed increase for municipal electricity tariffs - SA can no longer afford Eskom
Proposed increase for municipal electricity tariffs - SA can no longer afford Eskom

According to a report by Moneyweb with the headline “Nersa proposes 15,1% hike in municipal tariffs” (12 April 2023), the energy regulator is awaiting feedback on the proposed increase in the price of municipal electricity.

The basis for this is Eskom’s increase of 18,49% for bulk supply to municipalities. This price equals about 74% of what it costs municipalities to supply electricity to consumers.

It is a severe blow for consumers, who are already struggling due to high interest rates. It makes Eskom’s electricity seem less appealing to anyone who has other options to choose from. It is expensive and unreliable.

While the new Minister of Electricity, Mr Sputla Ramakgopa, is apparently committed to Eskom’s dilapidated coal-fired power stations, more and more households and communities are coming up with their own solutions.

While solar power can only be generated during hours of sunshine, households have many options available to them for managing and storing it.

Batteries are an obvious solution. A community could benefit from varying consumer patterns by setting up a shared battery system rather than having one for each household.

In addition, heated geysers and cooled fridges and freezers are also ways of storing energy.

From a macro perspective, surplus solar power is available at noon to pump water, which can then run back down over hydropower turbines during peak times.

When electricity is abundant and affordable, little thought is given to managing it effectively. The opposite is, however, true now.

There is technology available to continually vary the electricity tariff based on supply and demand. It means that consumers and suppliers would be able to store energy and then make it available at the times when they will benefit the most.

A baseload is indeed needed to maintain the electricity grid’s correct frequency, but as consumers increasingly generate to meet their own needs, the required baseload will decrease.

At present, energy supply is in a transitioning phase where different technologies are competing.

Only time will tell whether the baseload will come from green hydrogen, small-scale nuclear power stations or some other emerging form of technology – or still from coal – in the future.

Government should be expected to implement a tariff structure based on efficiency rather than vested interests.

Read the original article in Afrikaans by Dr. Wynand Boshoff on FF Plus