Plug in to the truth: Your money has been captured

The response to our report yesterday on the price of electricity was overwhelming: South Africans feel they are being ripped off. If anything our headline, “Daylight robbery”, was an understatement, judging by feedback elsewhere on this page.

The Organisation Undoing Tax Abuse argues that the average household’s monthly bill should be R290, around a quarter of its current level. It’s an astonishing claim, but as we begin to comprehend the extent to which state capture’s tentacles have reached into our pockets, is it really that outlandish?

In February worldatlas.com’s global comparison of electricity prices said South Africans were paying 8.97 US cents for a unit of power, not far off Australians (9.71c) and Finns (8.59c). The problem is that income levels in the three countries are so disparate. In US dollar terms, the average monthly pay of a working South African is $1 433. The typical Australian earns $5 476, while a Finnmakes $2 941.

In terms of the relative price of electricity, therefore, Finland is twice as affordable andDown Under they’re paying about a quarter of what South Africans are shelling out.

Bureaucrats setting prices in Canberra and Helsinki are also spared the searing challenges of poverty, inequality and unemployment that should be weighing heavily on the National Energy Regulator of South Africa as it  ponders Eskom ’s request for a 20% tariff increase.

There ’s an even scarier comparison. South Africa’s GDP per capita in 2016 was $5 273.Finland ’s was eight times that and Australia’s nearly 10 times higher. In other words, theaverage South African is an economic minnow, but he or she has a whale-size electricity bill. 

Has Eskom’s legendary inefficiency really reached this level? It seems doubtful. Which brings us back to the chilling thought that every individual lucky enough to have an electricity supply has had their wallet well and truly captured.