South Africa’s electricity tariffs have increased by more than 900% since 2007, according to Electricity and Energy Minister Kgosientsho Ramokgopa. Speaking ahead of the release of the government’s new electricity pricing policy for public comment, the minister said tariffs had risen from about 19 cents per kilowatt-hour in 2007 to more than R3.70 per kilowatt-hour today. The announcement is significant for households, businesses and industries across Gauteng, where electricity remains a major monthly expense and an important driver of economic activity.
Government says the proposed policy aims to create a more transparent pricing system while introducing measures to support vulnerable households and improve long term planning for businesses.
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Electricity Tariffs Have Increased Significantly Since 2007
According to Ramokgopa, electricity prices have increased substantially over the past two decades while inflation over the same period was considerably lower.
He said rising electricity costs have placed increasing pressure on household budgets while affecting the competitiveness of energy intensive industries.
The minister said government recognises that electricity pricing has become an important economic issue requiring long term reform.
Earlier this year, the National Energy Regulator of South Africa approved an average Eskom tariff increase of 8.76% for the 2026 to 2027 financial year, followed by an expected increase of 8.83% in 2027 to 2028. Municipal distributors have also implemented similar average increases.
Government Plans New Electricity Pricing Policy
Ramokgopa said government will publish a new electricity pricing policy for public comment.
According to the minister, the proposed policy seeks to:
- Improve transparency in electricity pricing.
- Create a fairer tariff structure.
- Support industries that rely heavily on electricity.
- Strengthen protection for low income and vulnerable households.
- Improve long term price certainty.
He said the policy is intended to balance affordability with the financial sustainability of the electricity sector.
More Free Basic Electricity Proposed
One of the proposals outlined by the minister is an increase in the amount of free basic electricity available to qualifying households.
Currently, eligible households receive 50 kilowatt hours of free electricity each month.
Ramokgopa said government is considering increasing that allocation to between 200 and 300 kilowatt hours per month as part of broader social protection measures.
According to the minister, the proposal aims to assist indigent households while ensuring access to essential electricity services.
Focus on Fairer Municipal Tariffs
Government also wants to review the way municipal electricity tariffs are structured.
Ramokgopa said the proposed policy seeks to reduce situations where compliant consumers effectively carry additional costs arising from unpaid municipal electricity accounts.
He said the intention is to improve fairness within the electricity pricing system while strengthening financial sustainability across municipalities.
Reducing Electricity Losses Remains a Priority
The minister said government also wants to address technical and non technical electricity losses.
According to Ramokgopa, these losses can account for up to 30% of the electricity purchased from Eskom in some areas.
He said improving infrastructure maintenance and reducing illegal electricity connections will form part of broader reforms aimed at improving the efficiency of the electricity network.
Greater Price Certainty for Investors
Another proposal under the new policy is the publication of a 10 year electricity price outlook by the National Energy Regulator of South Africa.
According to Ramokgopa, long term pricing forecasts would provide greater certainty for investors and industries that rely on electricity as a significant production cost.
Government believes this could support investment decisions while contributing to economic growth and job creation.
Why This Matters for Gauteng
Gauteng is South Africa’s economic hub and home to a large concentration of households, manufacturers, commercial businesses and service industries that depend on reliable and affordable electricity.
Changes to electricity pricing directly affect household budgets, operating costs for businesses and investment decisions across the province.
The proposed reforms could also influence future municipal electricity tariffs and the level of support available to qualifying households.
What This Means for Gauteng Residents
For residents across Gauteng, electricity remains one of the largest monthly household expenses.
Government’s proposed pricing reforms aim to improve transparency while providing greater protection for vulnerable consumers through expanded free basic electricity and fairer tariff structures.
Businesses and industries are also expected to monitor the proposed policy closely as it may influence future electricity costs and long term planning.
The draft policy will be released for public comment, giving stakeholders an opportunity to provide input before any changes are finalised.
Frequently Asked Questions
Why have electricity prices increased?
According to the minister, electricity tariffs have increased significantly since 2007 and government has acknowledged the impact on households and businesses.
What is the new electricity pricing policy?
Government says the proposed policy aims to improve transparency, create fairer tariffs, strengthen social protection and provide greater long term price certainty.
Will free basic electricity increase?
Government is proposing an increase from the current 50 kilowatt hours per month to between 200 and 300 kilowatt hours for qualifying households.
Will electricity prices decrease?
The minister did not announce any immediate tariff reductions. The proposed policy focuses on reforming the pricing system and improving affordability over time.
When will the new policy be available?
According to the minister, the draft electricity pricing policy will be released for public comment before implementation.
Looking Ahead
Government’s proposed electricity pricing reforms represent an effort to improve the way electricity costs are structured and managed in South Africa. While tariffs have risen substantially over the past two decades, the new policy seeks to introduce greater transparency, strengthen support for vulnerable households and provide a clearer long term pricing framework for consumers, businesses and investors. Public participation on the draft policy is expected to play an important role in shaping the final approach to electricity pricing in South Africa.
