Minister of public enterprises Pravin Gordhan has written to National Assembly speaker Nosiviwe Mapisa-Nqakula to table a total average upward adjustment for the electricity retail tariff of 18.65% for 2023/24 and 12.74% for 2024/25.
“I request the annual average price increase and the schedule of standard prices for Eskom tariffs for municipalities be tabled in parliament on or before March 15 2024, as contemplated in the Municipal Finance Management Act, to allow for the implementation with effect from July 1 2024,” he said in a letter to the speaker.
The tabling brings Eskom a step closer to the tariff increases it applied for last year at the National Energy Regulator of South Africa (Nersa) of 18.65% in the 2023/24 financial year and 12.74% for the 2024/25 financial year. The Nersa determinations add up to revenue of R318bn for 2024 and R352bn for 2025. Business and civil society interest groups pushed back against the proposed tariff hike amid rising costs and worsening levels of load-shedding.
Gordhan’s letter, drafted on January 10, was tabled to parliament with a schedule of standard prices for municipalities. Gordhan tabled the letter and schedule along with court orders from previous years reaffirming the multiyear price determination (MYPD) as the appropriate mechanism for deciding electricity tariffs.
Also tabled by Gordhan was a letter to Eskom interim CEO Calib Cassim from Nersa CEO Nomalanga Sithole in December which said Nersa would approve the average tariff increases and affordability subsidy to be recovered from industrial and urban customers.
“The minister of finance last proclaimed a VAT increase in 2018, from 14% to 15%. Eskom will ensure its approved schedule of standard prices for 2024/25 is published on its website, communicated to all customers, and made easily available to the public on request,” she said.
The schedule of tariffs approved runs for the period April 1 2024 to March 31 2025.
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