Eskom’s 8.8% tariff hike adds over R2m to large business power bills
3 min read
An 8.8% tariff increase for Eskom-direct customers may sound manageable on paper, but for commercial and industrial (C&I) businesses, this will have a significant impact.
Our modelling shows that, for a large electricity user consuming around 1 000 000 kWh per month, a 24/7 operation could see its annual electricity costs increase by roughly R2.17 million, based on the estimated consumption for typical consumers in this range.
It is also important to bear in mind the headline percentage doesn’t tell the full story. The increases are not limited to energy charges alone; businesses are also facing pressure from network, legacy and other structural cost components, which continue to push total bills higher.
If you break it down further, using the same estimated parameters, peak charges could go up by almost 60c per kWh during high-demand winter months, which means a 24/7 operation could pay an extra R200 000 per month for that period alone. This means the actual impact is often more severe than expected, particularly for C&I businesses with specific load profiles or peak usage patterns.
The timing couldn’t be worse, as these tariff increases come into effect alongside a looming fuel price shock, which will feed directly into transport, logistics and input costs. For many businesses, this creates a compounded cost environment that is difficult to absorb without either raising prices and passing these costs onto the customer or cutting back elsewhere.
Now more than ever, it is important for businesses to diversify their energy mix, combining on-site solutions like solar and battery storage with virtual options like wheeling and energy trading.
Relying on a single source of electricity – particularly one with structurally rising costs – is becoming increasingly risky. Businesses that diversify their energy supply by incorporating wheeling and virtual wheeling are better positioned to manage cost volatility and build long-term resilience.
Just remember to consider the full spectrum of charges and increases – not just the 8.76% – when signing up for these virtual solution agreements.
Brandon Horn
Head: Commercial
