The Price of Electricity in 2021
South African’s were given a significant increase in the price of electricity by National Utility Eskom. This year alone, households across the country will experience as much as 10.1% higher electricity costs, which more than doubles the 2019/20 increase of 4.9%. Unsurprisingly, this has caused concern within households and amongst citizens everywhere, who are asking how this will affect their finances in 2021 and beyond.
First off, it’s important to note that exact tariff increases will differ depending on usage provider, however the general consensus is that an average increase of 10.1% should be expected in 2021. As per the approved tariff hike by NERSA (National Energy Regulator of South Africa), Eskom will additionally be receiving R5 billion for municipal debts levy- forgoing relief on petrol and diesel prices this month to make up for it.
What’s worse is that due to rising energy costs combined with South Africa’s financial strain linked with Covid-19, there’s speculative fear of further tariffs hikes from municipalities or third party contractors during 2021-further increasing electricity bills across the board. With this being said, it’s crucial for South African citizens to prepare for rising energy costs throughout 2021 and identify long term solutions by switching over to alternative power sources such as renewable energy suppliers or building up a private solar powered grid infrastructure at home.
Aside from short term solutions such as budgeting power consumption wisely but also basic tips such as unplugging unused appliances when not in use could help reduce localised bill impact marginally whilst longer term investments into renewable energy sources such as solar should be considered if one has suitable capacity on property and access to retirement funds etc., where applicable. Increasing your own sustainable capacity will also come in handy during times of unexpected load shedding when inevitable nationwide blackouts often occur -especially during summer months when SA usually experiences peak demand strain on insulation grids or lines due to extended hours of daylight intensifying usage pressure during hot months .
Overall there is no denying that Eskom electricity prices increases sting our pocketbooks straight away however longterm alternatives must also be explored to halt financial strain caused by failing national infrastructure should future hikes occur down the road
South Africans Feel the Pressure of Price Hikes as Eskom Increases Costs.
With the South African economy already under immense strain due to the COVID-19 pandemic, the South African government recently announced a steep increase in electricity costs. This hike, which was approved by the energy regulator NERSA (National Energy Regulator of South Africa) on behalf of Eskom, is set to have a substantial effect on both businesses and communities alike. The 8.1% increasing tariff that Eskom proposed for 2021 is an addition to the 3.1% allowed for each of the previous three years – taking place despite nearly 5 million people being without access to electricity across South Africa. This underscores the clear disconnect between cost management and any actual focus on improving infrastructure and poverty alleviation as many experts believe that this additional cost increase will have drastic effects on households’ ability to pay their bills and recoup from other financial losses during this time .
The public outcry surrounding this decision has been overwhelming – with many experts pointing out that there is no guarantee that it will actually benefit South Africans in any meaningful way or be sufficient in helping Eskom cover its debt and recover financially. Unfortunately, many argue that ratepayers are now being asked to bear much of the burden rather than finding more sustainable solutions that would benefit everyone in the long-term. This has resonated particularly strongly among those affected by job losses due to lockdown restrictions and those with existing vulnerable living conditions – essentially reinforcing inequality by asking them to shoulder an additional burden amidst high unemployment rates and salary cuts .
These financial adjustments have presented further difficulties as they effectively contradict government assurances made earlier in 2020 particularity when Cyril Ramaphosa spoke during his State of The Nation Address saying: “We are very conscious of delivering relief and hope to workers, households and businesses by avoiding large increases in electricity prices” – putting into question Eskom’s judgement regarding such controversial choices.
The impact of these hikes is already visible among various townships across South African cities where small businesses are yet again facing collapse after barely managing to reopen amid restrictions placed following their temporary closure last year due to COVID-19. To make matters worse, business who require energy-dependent services face added difficulty as their ability to cope with these new regulations become all the more daunting . As such , it is understandable why public consultation plays an important role in assessing such significant & sensitive considerations if all citizens are going to feel adequately represented & heard regarding future adjustments & proposal amendments related decisions made by or endorsed by Eskom .
In light of this situation, organizations like Earth Life Africa have come together in solidarity against unfair price hikes stating that “the promotion, maintenance and protection of affordable basic services for everyone is a non-negotiable constitutional requirement”. They are joined by other organizations – including SAEWA (South African Energy Working Association) – committed not only calling out policy makers but also offering feasible alternatives that weigh alongside issues like national debt obligations when discussing routes forward. However , as analysts warn : higher costs allocated towards energy substantially reduce budget funds allocated towards social services while simultaneously leading money into investments within sectors derived from fossil fuels — thus providing limited economic breathing spa ce needed at such precise moments In time .
How Can South Africans Prepare for Future Price Hikes from Eskom?
Recent news has indicated that Eskom, the state-owned electric utility of South Africa, is set to increase prices in 2021. This will likely have major ramifications for businesses and individuals alike. With this in mind, it is important for South Africans to take steps now to safeguard themselves against the pending price hike. Below we’ll discuss how one can effectively prepare for the price hikes from Eskom coming in 2021.
One of the best ways to meet the impact of higher electricity prices from Eskom is by investing in renewable energy sources such as solar power and wind energy solutions. Solar energy provides reliable electric power with no additional cost beyond installation, meaning that the cost of maintaining a solar power system is far lower than what would be required for continued use of traditional electricity sources supplied by Eskom. Additionally, venturing into renewable energy solutions offers an added benefit: financial incentives in the form of government subsidies or cheaper financing options on solar PV installations.
Another way to reduce exposure to future price hikes is to carefully monitor usage patterns and implement measures to reduce electricity consumption whenever possible. Businesses should conduct comprehensive audits and make changes wherever necessary by swapping inefficient lighting systems with LED lights or switching out old appliances with more energy-efficient models that require less electricity. Utilizing smart home controls also helps reduce energy use significantly; offsetting at least some of the additional costs associated with rising rates from Eskom.
Finally, despite all these steps being taken to reduce overall consumption levels, it may be necessary for citizens and businesses alike to allocate funds specifically towards increased electricity prices well ahead of their effective date – ensuring they are not caught off guard when the new tariffs kick in next year. By accounting early on through budgeting or projections done in-house or through external consultants, respective organizations can determine whether they can absorb any increases or need additional measures like cutting operating expenses or loan finance applications among other resources that may be needed in lieu of any potential disbalance in cashflows due to higher electricity rates from Eskom.
All things considered, South Africans need not panic over the looming tariff hikes from Eskom; instead they must take preventative action now – such as investing in renewable energy technologies, closely monitoring how much power its used and allocating funds where appropriate -to ensure that their finances remain intact even during times when traditional electricity suppliers such as Eskom raise prices due to hikes imposed upon them by governing bodies/policy makers at both local & national level.