Eskom’s average tariff increase for direct customers has been revised upward to 8.76 percent, taking effect on 1 April. This follows a revenue miscalculation by the National Energy Regulator of South Africa.
A further increase of 8.83 percent is already expected in 2027, adding to ongoing cost pressures.
The real cost behind the headline figure
While the increase may appear moderate, the actual financial impact on businesses is far greater.
Analysis from SolarAfrica shows that large commercial and industrial users will face significant cost increases. For a business consuming around 1 000 000 kWh per month, annual electricity costs could rise by approximately R2.17 million.
This highlights how percentage increases translate into substantial real-world expenses for high-consumption operations.
Why businesses will feel the strain
The tariff increase extends beyond energy charges. Businesses are also absorbing higher costs linked to network fees, legacy charges and other structural components.
Peak tariffs present an even bigger challenge. During high-demand winter months, peak charges could increase by nearly 60 cents per kWh. This could add around R200 000 per month for a 24-hour operation.
For many companies, the combined effect results in a much higher overall increase than the headline figure suggests.
A compounded cost environment
The timing of the tariff adjustment adds further pressure.
Rising electricity costs coincide with expected fuel price increases, which directly affect transport, logistics and production expenses. This creates a compounded cost environment that is difficult for businesses to absorb.
Companies may need to raise prices or reduce operational costs to remain viable.
The case for energy diversification
Industry experts warn that relying on a single electricity source is becoming increasingly risky.
Brandon Horn, Head of Commercial at SolarAfrica, says businesses need to diversify their energy mix. This includes integrating on-site solutions such as solar and battery storage, alongside virtual options like wheeling and energy trading.
Diversification helps reduce exposure to rising tariffs and improves long-term cost stability.
Looking beyond the percentage
Businesses are advised to consider the full structure of electricity costs, not only the headline tariff increase.
Understanding peak charges, network fees and other components is critical when planning energy strategies or entering into new supply agreements.
