Upcoming increases to the cost of electricity, and the effect on your pocket

Nersa (the National Energy Regulator of South Africa) has granted Eskom approval to increase its tariffs for the 2016/2017 year. Initially, in November of last year, Eskom had requested a value of R22.8 billion from Nersa to recover costs lost over the 2013/2014 period. In trying to balance the interests and cost implications of both the energy producers and South Africa’s general consumers, Nersa granted half of what was initially requested – roughly R11.2 billion. Thus, consumers will face a 9.4% increase to the standard electricity tariff, effective from the 1st of April 2016.

How do these cost increases affect the average citizen?

With the increases in electricity costs, we are to face even more challenges in an already pressing economic climate. For consumers living in Eskom regulated areas, the cost implications are more transparent, but for others residing in the City Council distribution network, the additional costs added by city council would result in more expensive increases.

northwood-electricity-lightbulb-black-backgroundWith the increase in electricity costs, now might be a good time to seriously consider implementing renewable energy resources; on small scales, such as a solar-powered household unit; to prioritise long-term savings over short-term expense. For example, we fitted our household with a solar geyser system to relieve the long-term costs of periodical electricity expenses.

 

The cost of the solar fitting was expensive – R 7000 in total – but the benefits of long-term savings far outweigh the cost. During the course of one year, the geyser itself remains permanently turned off for six months, and only requires operation for one hour per day for the remaining six months.

Over the past few years, developments in the renewable energy sector have grown. Wind turbines generate enough electricity to supply power to a grid of roughly 500,000 households, and solar farms are being produced to supply current to millions of families. Despite the possibilities of renewable energy sources, coal-generated electricity still makes up 77% of our grid; with additional sources including nuclear, gas, oil, renewable, as well as imported sources.

There are growing opportunities to further supplement our power supply with renewable energy sources. In such pressing times of increasing electricity charges, it is advisable to consider small-scale solutions that can be implemented into the average household, before waiting for national intervention.

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