Tariff hikes could be the norm for major South African cities

Tariff hikes are front and center in the proposed budgets for both the City of Cape Town and the City of Johannesburg for the 2021/2022 financial year.

Johannesburg residents could soon be paying R200 more for electricity each month, even before they start using it and this could come into effect as soon as July 2021.

According to a tariff document published on the Metropolitan Municipality’s website, the charge is aimed at prepaid users to “start making appropriate contribution to the cost of operating and maintaining the City Power electricity distribution network to be available on demand”.

The proposed tariff for businesses is R400 per month.

Should the latest proposal be approved and come into effect, the capacity charge will go on top of the electricity price hikes which the City wants to introduce following the increase of Eskom’s tariffs on 1 April 2021.

It has been proposed that starting from 1 July 2021, Johannesburg customers on prepaid block 1 – for use up to 350kWh – should pay 9.1% more. For usage on block 2 tariff prices will be increased by 18.1%.

The City of Johannesburg has further proposed that qualifying residential prepaid customers in non-affluent areas with no renewable energy installed, except for solar water geysers, should be given the option of a flat rate of R200 per month for the first 350kWh of electricity usage.

Meanwhile, most Johannesburg residents with conventional metres will have to pay 14.59% more for electricity.

For the City of Cape Town, the new proposed budget would see water tariffs increase by 5%, largely due to “upgrades and extensions to the wastewater treatment plants, the installation of water connections and the testing of meters”.

The Mother City’s electricity tariff increase will increase by 13%.

It should be noted that the abovementioned changes still require approval from energy regulator Nersa.

Source: ESI Africa

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