City of Johannesburg electricity utility City Power said the National Energy Regulator of South Africa (Nersa) has approved its application for an average electricity tariff increase of 7.47%, which is essential to cover the increased cost of bulk purchases from Eskom, which increased by 8.61%, as well as to cover an inflationary adjustment, which increased by 4.4%, to City Power’s operating cost.
City Power, after an extensive public consultation process, applied to Nersa for the average tariff increase, which will come into effect from July.
City Power has 22 different tariffs for its four different customer categories, namely residential, business, agricultural and large power users. All City Power tariff subcategories are increasing by 7.47%, except for the business convention tariff that has been limited to 4.4% to gradually align with the Nersa benchmarks for the particular customer category.
"City Power, in its operations, always strives to ensure that electricity is available and is affordable for our customers who are already buckling under tough economic conditions.
"It is for this reason that, while [State-owned power utility] Eskom's average tariff increase for 2022 is 9.61%, with an increase of 8.61% levied to municipalities, including City Power, we managed to get our average tariff increase for 2022 at 7.47%, which is differentiated for the different customer categories," the utility said.
At the time of the public consultation process, it was expected that the electricity tariffs would on average increase by 9.61%. In consideration of the current economic conditions where most of our residents are affected, and given the Nersa guideline increase for municipal entities, City Power revised its proposed increase down to 7.47%, which was then approved.
An electricity user that uses 350 kWh a month will pay R51.02 more each month, and a 500 kWh a month user will pay R76.10 more each month, City Power said.