Having just come out of winter (summer is now officially OPEN), and with a decreased summer load on the national grid, you would expect that a little relief would be in order from our nation’s energy supplier – not quite. After lukewarm showers, green swimming pools and rooms lit with a single lightbulb, we’ll be finding out this week if we’re in for another increase in the price of electricity.

Eskom has applied to the National Energy Regulator to approve a five year plan that will result in an average increase of 16% each year. What this means, essentially, is that in about five years time, you’ll be paying about twice what you’re paying now to keep your laptop charged and your lights on.

The increase, if approved, will see the price of 61c per kilowatt-hour increase to a staggering 128c per kilowatt-hour. The current price is 61c a unit, I hear you scream? “That can’t be possible! R6,10 most definitely does not buy me ten units!” Well, that’s because that price excludes the VAT charged on the transaction, as well as the ever-elusive “service fee” which no-one in South Africa can seem to explain or accurately predict. All we know is that R200 has never, ever bought the same amount of units.

Eskom has stated that 13% of the proposed increase will be for its own needs, while 3% will be set aside to support independent power producers. These producers will then sell their electricity to Eskom, who will distribute it using their existing grid infrastructure.

Factors taken into account for the increase include a predicted increase in demand estimated at 1,9%, as well as its power generation expansion programme.

Approval of the proposal will mean consumers can expect a rise from the beginning of next year, with steady increases until March 2018. An Eskom spokesperson has said that South Africans have for as long as three decades been paying less than inflation for their electricity and that the increases are a way of bringing the prices in line.

Economist Mike Schussler disagrees though, failing to understand how a country that produces its own coal and has its own power plants can have among the highest electricity tariffs in the world.

[Source: EWN; Business Day]