The entity also proposed separating charges for energy, capacity, and network services saying this supports its organisational restructuring and aligns with the competitive electricity market’s requirements.
However, critics argue that high fixed charges disproportionately affect low-income households and small-scale renewable energy users.
Civil society organisations raised concerns about the fixed charges impacting low-income households, particularly those not classified as indigent. Many believe the classification system is flawed, as it excludes low-usage consumers who face high electricity bills.
Southern African Faith Communities' Environment Institute presentative Mishkah Moeral said they advocate for a tariff restructuring approach that “establishes a national initiative, involving Eskom, local authorities, and civil society, to position customers as active participants in efficient electricity use [and] educates customers about electricity service costs, tariff structures, and cost-saving options to support optimal electricity use."
Meanwhile City Power representative Frank Hinda emphasised the importance of a balanced and deliberate approach to tariff restructuring to avoid adverse affects on customers while supporting Eskom’s operational needs.
“Legacy charges must be re-evaluated to ensure an equitable approach to unbundling the generation tariff. Tariff restructuring should ideally avoid being implemented at the start of a new tariff cycle to provide greater price certainty for customers,” said Hinda.
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Eskom proposes revised tariff structure for fair cost distribution
Image: Michael Kimberley
Eskom has put forward a proposal to the National Energy Regulator of SA which is aimed at restructuring tariffs to ensure fairness, sustainability, and alignment with the actual costs of providing electricity.
These changes are meant to address outdated tariff structures, unbundle energy charges, and simplify pricing for municipalities and residential customers, it said.
The power entity revealed this on Friday during the electricity subcommittee public meeting.
Onicah Rantwane, chief adviser in electricity pricing at Eskom distribution, said currently service charges are applied at the account level. She said they were proposing charging these fees per point of supply to address cross-subsidisation issues, ensuring fairer cost distribution.
“Eskom plans to eliminate the inclining block tariff structure, which charges higher rates for increased consumption, and replace it with a flat cents-per-kilowatt-hour tariff for home light customers,” Rantwane said.
The entity also proposed separating charges for energy, capacity, and network services saying this supports its organisational restructuring and aligns with the competitive electricity market’s requirements.
However, critics argue that high fixed charges disproportionately affect low-income households and small-scale renewable energy users.
Civil society organisations raised concerns about the fixed charges impacting low-income households, particularly those not classified as indigent. Many believe the classification system is flawed, as it excludes low-usage consumers who face high electricity bills.
Southern African Faith Communities' Environment Institute presentative Mishkah Moeral said they advocate for a tariff restructuring approach that “establishes a national initiative, involving Eskom, local authorities, and civil society, to position customers as active participants in efficient electricity use [and] educates customers about electricity service costs, tariff structures, and cost-saving options to support optimal electricity use."
Meanwhile City Power representative Frank Hinda emphasised the importance of a balanced and deliberate approach to tariff restructuring to avoid adverse affects on customers while supporting Eskom’s operational needs.
“Legacy charges must be re-evaluated to ensure an equitable approach to unbundling the generation tariff. Tariff restructuring should ideally avoid being implemented at the start of a new tariff cycle to provide greater price certainty for customers,” said Hinda.
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