South African households are bracing for another significant increase in electricity tariffs, with the National Energy Regulator of South Africa (NERSA) approving Eskom’s tariffs for the 2026/27 financial year.
This latest adjustment, effective from April 1, 2026, for direct customers and July 1, 2026, for municipal customers, signals a strategic shift in Eskom’s revenue recovery model that disproportionately impacts ordinary households and even those embracing renewable energy solutions.
Direct Eskom customers will see an 8.76% increase, while municipal customers face a 9.01% hike. However, the most contentious aspect of this tariff adjustment lies in the substantial increase in fixed charges for residential tariffs like Homeflex 4 and Homepower 4, which are set to rise by a staggering 28%.
This move is part of Eskom’s broader strategy, known as Phase 1 RTP (Revenue Recovery Plan), aimed at shifting revenue recovery from per-unit energy charges to fixed fees. The historical context reveals that this isn’t a new trend; previous phases of the RTP have already led to an 88% increase in fixed fees, contributing to an average 12.74% electricity increase.
The implications of this shift are profound. Low-to-moderate consumption households, who traditionally benefited from lower overall bills due to their conservative electricity use, will now be hit hardest. Their ability to manage costs by reducing consumption is undermined by the escalating fixed charges, which they must pay regardless of how much electricity they use.
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This creates a challenging scenario for budget-conscious families already struggling with the rising cost of living. Furthermore, the increase in fixed charges indirectly impacts rooftop solar users. While these households generate their own electricity and reduce their reliance on the grid, they still incur fixed charges for grid connection.
This means they are, in essence, subsidizing heavy grid users, as a larger portion of Eskom’s revenue is now secured through these unavoidable fixed fees. This raises questions about fairness and the incentive for renewable energy adoption among residential consumers.
Stakeholders, including NERSA, Eskom, municipalities, and the Electricity Resellers Association, are at the heart of this complex issue. While Eskom seeks revenue stability to maintain and upgrade its aging infrastructure, the ethos of rising fixed electricity costs suggests a system where ordinary households bear an increasing burden.
This ongoing challenge highlights the delicate balance between ensuring Eskom’s financial viability and protecting consumers from unsustainable electricity costs.
By Thuita Gatero, Managing Editor, Africa Digest News. He specializes in conversations around data centers, AI, cloud infrastructure, and energy.
