Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      Why the AI gold rush may be smaller than Eskom hopes - Teraco CT2

      Why the AI gold rush may be smaller than Eskom hopes

      12 August 2026
      Sixty60 now drives more than a third of Shoprite's growth - Neil Schreuder

      Sixty60 now drives more than a third of Shoprite’s growth

      12 August 2026
      Checkers answers Pick n Pay in the grocery AI race

      Checkers answers Pick n Pay in the grocery AI race

      12 August 2026
      The payment ring winning over South Africa's banks - Vezopay

      The payment ring winning over South Africa’s banks

      12 August 2026
      TCS | Money just became native to the internet - Steven Boykey Sidley

      TCS | Money just became native to the internet – Steven Boykey Sidley

      12 August 2026
    • World
      Russia building its own Starlink - and faster than expected - Vadym Skibitskyi

      Russia building its own Starlink – and faster than expected

      11 August 2026
      Meta AI will now tell parents if their teen is in crisis

      Meta AI will now tell parents if their teen is in crisis

      17 July 2026
      IBM shares crash 25% as AI upends software spending - Arvind Krishna

      IBM shares crash 25% as AI upends software spending

      15 July 2026
      Jony Ive's first OpenAI device: an AI smart speaker - Jony Ive and Sam Altman

      Jony Ive’s first OpenAI device: an AI smart speaker

      15 July 2026
      Stripe, Advent in talks to buy PayPal for $53-billion

      Stripe, Advent in talks to buy PayPal for $53-billion

      15 July 2026
    • In-depth
      The plan to stop AI from breaking the world - Google DeepMind CEO Demis Hassabis. Image: John Sears

      The plan to stop AI from breaking the world

      16 July 2026
      The internet has a Strait of Hormuz problem

      The internet has a Strait of Hormuz problem

      15 July 2026
      AI boom sparks rally, frenzy and fear

      AI boom sparks rally, frenzy and fear

      11 June 2026
      Every plug-in hybrid on sale in South Africa, ranked by price - Lamborghini Temerario

      Every plug-in hybrid on sale in South Africa, ranked by price

      7 June 2026
      What Wi-Fi 8 will mean for wireless networks

      What Wi-Fi 8 will mean for wireless networks

      1 June 2026
    • TCS
      TCS+ | Specops' Darren James on continuous trust in an AI world

      TCS+ | Specops’ Darren James on continuous trust in an AI world

      7 August 2026
      TCS+ | How AI is turning hardware into a subscription service - Shane van der Merwe Merchant West

      TCS+ | How AI is turning hardware into a subscription service

      6 August 2026
      TCS+ | Why South African workers must become supervisors of digital labour - Accelera Digital Group Cliff de Wit

      TCS+ | Why South African workers must become supervisors of digital labour

      31 July 2026
      TCS | Rapid deployment rules can't work without municipalities: ACT - Nomvuyiso Batyi

      TCS | Icasa’s rules skip the real bottleneck: ACT

      30 July 2026
      TCS+ | iStore Business on why Apple makes sense for SMEs - Sudesh Pillay and Tamia Nontsikelelo

      TCS+ | iStore Business on why Apple makes sense for SMEs

      30 July 2026
    • Opinion
      The author, Jannie van Zyl

      Selling vapour is corporate suicide in slow motion

      16 July 2026
      Brazil's online gambling crackdown is a lesson for South Africa

      How Amazon outmanoeuvred Starlink in South Africa

      15 July 2026
      The Popia problem with agentic AI - Herman Haasbroek

      The Popia problem with agentic AI

      14 July 2026
      The author, Fanie van Rooyen

      South Africa can still catch the AI wave – here’s how

      7 July 2026
      The author, Fanie van Rooyen

      The AI utopia South Africa can’t afford

      1 July 2026
    • Company Hubs
      • 1Stream
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • Ascent Technology
      • AvertITD
      • BBD
      • Braintree
      • CallMiner
      • CambriLearn
      • CM Telecom
      • Contactable
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • HOSTAFRICA
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • Kaspersky
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Telviva
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Vox
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • HealthTech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Policy and regulation
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
      • Watts & Wheels
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Sections » Energy and sustainability » Jo’burg tables shock electricity tariff hike plan

    Jo’burg tables shock electricity tariff hike plan

    By Staff Reporter1 June 2020
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    Johannesburg households and businesses using prepaid electricity are in for a shock if the fixed charges proposed in the city’s draft budget are approved. The budget was tabled on Friday and stakeholders have until 23 June to comment.

    The City of Johannesburg proposes a new R200 basic charge for prepaid residential customers and R400 for prepaid business customers.

    That is over and above the increases to existing charges per kilowatt-hour used, which are way above the current inflation rate. The proposal is for an 8.1% increase for residential prepaid and 5.8% for business.

    The city tried to introduce the R200 basic charge for prepaid residential users last year, without even including it in the draft budget

    In addition, the lowest tariff block for residential prepaid customers would be reduced by 50kWh to 300kWh, meaning that higher tariff blocks will be reached earlier in the month than before.

    This means a household that uses 374 units a month will go from paying R527 to R780/month, excluding VAT, from 1 July if the proposal is accepted – an increase of almost 50%.

    This is not properly disclosed in the document published for public comment because, in calculating the average increase per user group, only the increase in charges per kilowatt-hour used is taken into account.

    The city tried to introduce the R200 basic charge for prepaid residential users last year, without even including it in the draft budget, but scrapped the fee after it was disclosed by Moneyweb.

    Closing the gap

    According to a report to the mayoral committee dated 20 March, the new charges are aimed at closing the gap between prepaid and conventional users.

    It states that the “residential prepaid customer currently does not make (an adequate) contribution to the cost of operating and maintaining the electricity infrastructure to ensure its availability on demand. It is therefore proposed to introduce a capacity charge of R200/m for all residential prepaid customers.” (sic)

    If the city gets its way, it will increasingly be closing the gap between residential prepaid and conventional users over the next three years.

    Residential users who have been buying electricity on credit are currently paying fixed charges of R527/month. The city proposes increasing this to R757/month, in itself a 43% increase.

    In its budget document the city also understates the proposed tariff increase for conventional users at 8.1% by excluding the fixed charges from the calculation.

    The introduction of the R400 basic charge for prepaid business customers is also aimed at closing the gap between them and conventional users. In the report to the mayoral committee it is proposed that this be increased by a further R400 next year.

    Domestic tariffs should work out around R2-R2.20/kWh and the current tariffs in the City of Jo’burg are well below that

    Conventional business users currently pay between R800 and R900/month in basic charges, with the unit cost only slightly lower than that of their prepaid counterparts.

    The report to the mayoral committee states: “Currently, customers on business tariff can avoid paying any basic charges by simply converting to the prepaid tariff. The business prepaid customer currently does not make (an adequate) contribution to the cost of operating and maintaining the electricity infrastructure to ensure its availability on demand.”

    According to David Mertens of the Nelson Mandela Bay Business Chamber, who has conducted a study of electricity tariffs, the increase the City of Johannesburg is looking for is well above the Nersa guideline of 6.22% and will need proper justification. Nersa is South Africa’s energy regulator.

    Justifiable?

    Mertens says that while the new basic charges will be a shock to customers, they might be justifiable.

    He says basic charges in the tariff structure can mitigate the risk of non-payment and electricity theft. If meter tampering results in undercharging, the basic charge will at least guarantee the municipality some income.

    Mertens says most municipalities are under-recovering on domestic tariffs “because that is where the votes are” – and Nersa has been allowing it.

    This results in other customer groups, especially industry, paying more to subsidise residential users.

    “Domestic tariffs should work out around R2-R2.20/kWh on average and the current tariffs in the City of Jo’burg are well below that,” he says.

    Mertens says the rationale regarding fixed charges is clearly aimed at covering the substantial basic cost domestic users represent for municipalities.

    While a fixed charge is in line with cost reflectivity and should be part of the tariff, the amount at which such a charge is set can be debated, he says.

    “I think R100-R150/month or even R200/user would not be unreasonable,” says Mertens. “R500 for conventional metering seems very heavy to me, but that might be the right measure to move people to prepaid and to get rid of non-payment.”

    Mertens also notes that the City of Jo’burg has electricity losses of more than 20%, more than double the rate expected from a good distributor. The city would try to compensate for the loss through tariffs, he says.

    “The big question is what the city will do to stem the losses and increase efficiency. The fixed charge might help in some respects, but the problem is much bigger than that.”

    • This article was originally published on Moneyweb and is used here with permission
    Follow TechCentral on Google News Add TechCentral as your preferred source on Google


    David Mertens Eskom top
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleInterview: Leon Louw of the Free Market Foundation
    Next Article Solar PV prices are crashing – and that could lead to a new boom

    Related Posts

    Why the AI gold rush may be smaller than Eskom hopes - Teraco CT2

    Why the AI gold rush may be smaller than Eskom hopes

    12 August 2026
    Eskom fixed the fleet and the customers left

    Eskom fixed the fleet and the customers left

    7 August 2026
    The debate about the grid is over

    The debate about the grid is over

    3 August 2026
    Company News
    Build or buy software? AI is rewriting the answer - BBD Software

    Build or buy software? AI is rewriting the answer

    12 August 2026
    Max zoom meets max speed with the new 5G Huawei Pura 90s series

    Max Zoom meets Max Speed with the 5G Huawei Pura 90s series

    11 August 2026
    The MSP of 2027 won't be defined by the size of its stack - Acronis

    The MSP of 2027 won’t be defined by the size of its stack

    11 August 2026
    Opinion
    The author, Jannie van Zyl

    Selling vapour is corporate suicide in slow motion

    16 July 2026
    Brazil's online gambling crackdown is a lesson for South Africa

    How Amazon outmanoeuvred Starlink in South Africa

    15 July 2026
    The Popia problem with agentic AI - Herman Haasbroek

    The Popia problem with agentic AI

    14 July 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    Why the AI gold rush may be smaller than Eskom hopes - Teraco CT2

    Why the AI gold rush may be smaller than Eskom hopes

    12 August 2026
    Sixty60 now drives more than a third of Shoprite's growth - Neil Schreuder

    Sixty60 now drives more than a third of Shoprite’s growth

    12 August 2026
    Checkers answers Pick n Pay in the grocery AI race

    Checkers answers Pick n Pay in the grocery AI race

    12 August 2026
    The payment ring winning over South Africa's banks - Vezopay

    The payment ring winning over South Africa’s banks

    12 August 2026
    © 2009 - 2026 NewsCentral Media
    Built and maintained by Chronon
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}