{"id":25962,"date":"2025-08-29T09:17:03","date_gmt":"2025-08-29T07:17:03","guid":{"rendered":"https:\/\/www.gauteng.net\/whats-on-g\/?p=25962"},"modified":"2026-03-12T09:56:32","modified_gmt":"2026-03-12T07:56:32","slug":"nersa-settlement-eskoms-r54bn-tariff-hike","status":"publish","type":"post","link":"https:\/\/www.gauteng.net\/whats-on-g\/nersa-settlement-eskoms-r54bn-tariff-hike\/","title":{"rendered":"South Africans Warned of Possible Tariff Hikes After Eskom\u2019s R54bn NERSA Settlement"},"content":{"rendered":"\n<div class=\"wp-block-group is-vertical is-layout-flex wp-container-core-group-is-layout-8cf370e7 wp-block-group-is-layout-flex\">\n<p>Electricity users in South Africa may face higher costs after Eskom and the National Energy Regulator of South Africa (NERSA) reached a significant financial settlement. The two parties agreed on a R54 billion settlement stemming from errors in NERSA&#8217;s electricity price calculations. This development has important implications for consumers and the country\u2019s energy future.<\/p>\n\n\n\n<p><strong>RELEVANT ARTICLE:<\/strong> <a href=\"https:\/\/www.gauteng.net\/whats-on-g\/eskom-100-day-streak\/\">Eskom Reaches 100-Day Streak Without Load Shedding \u2014 Will It Continue?<\/a><\/p>\n<\/div>\n\n\n\n<div class=\"wp-block-yoast-seo-table-of-contents yoast-table-of-contents\"><h2>Table of contents<\/h2><ul><li><a href=\"#what-led-to-the-settlement\" data-level=\"2\">What Led to the Settlement?<\/a><\/li><li><a href=\"#understanding-nersas-role\" data-level=\"2\">Understanding NERSA\u2019s Role<\/a><\/li><li><a href=\"#what-are-electricity-tariffs-and-how-do-they-work\" data-level=\"2\">What Are Electricity Tariffs and How Do They Work?<\/a><\/li><li><a href=\"#why-this-settlement-matters\" data-level=\"2\">Why This Settlement Matters<\/a><\/li><li><a href=\"#impact-on-south-african-households\" data-level=\"2\">Impact on South African Households<\/a><\/li><li><a href=\"#eskoms-financial-struggles-continue\" data-level=\"2\">Eskom\u2019s Financial Struggles Continue<\/a><\/li><li><a href=\"#criticism-from-opposition-and-unions\" data-level=\"2\">NERSA Settlement: Criticism from Opposition and Unions<\/a><\/li><li><a href=\"#what-does-the-settlement-mean-for-energy-regulatio\" data-level=\"2\">What Does the NERSA Settlement Mean for Energy Regulation?<\/a><\/li><li><a href=\"#moving-towards-sustainable-energy-solutions\" data-level=\"2\">Moving Towards Sustainable Energy Solutions<\/a><\/li><li><a href=\"#what-south-africans-should-know\" data-level=\"2\">Tariff Hike: What South Africans Should Know<\/a><\/li><li><a href=\"#looking-ahead\" data-level=\"2\">Energy Supply<\/a><\/li><\/ul><\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-led-to-the-settlement\">What Led to the Settlement?<\/h2>\n\n\n\n<p>NERSA had initially set electricity tariffs under the Sixth Multi-Year Price Determination (MYPD6). Eskom challenged these calculations through a judicial review process, arguing they were incorrect. Following this legal action, NERSA admitted mistakes in its methodology. As a result, on 30 July 2025, Eskom and NERSA settled the dispute for R54 billion. This settlement represents an adjustment for tariffs <a href=\"https:\/\/www.ewn.co.za\/2025\/08\/29\/nersa-reaches-r54bn-settlement-with-eskom-over-electricity-price-hikes\" target=\"_blank\" rel=\"noreferrer noopener\">initially set<\/a> too low.<\/p>\n\n\n\n<div id=\"gaute-1464264040\" class=\"gaute-inbetween-content gaute-entity-placement\" style=\"margin-top: 30px;margin-bottom: 30px;margin-left: auto;margin-right: auto;text-align: center;\"><div class=\"gaute-adlabel\">Advertisement<\/div><script async src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1852772760112594\" crossorigin=\"anonymous\"><\/script><ins class=\"adsbygoogle\" style=\"display:block;\" data-ad-client=\"ca-pub-1852772760112594\" \ndata-ad-slot=\"1819787043\" \ndata-ad-format=\"auto\" data-full-width-responsive=\"true\"><\/ins>\n<script> \n(adsbygoogle = window.adsbygoogle || []).push({}); \n<\/script>\n<\/div><h2 class=\"wp-block-heading\" id=\"understanding-nersas-role\">Understanding NERSA\u2019s Role<\/h2>\n\n\n\n<p>NERSA is the regulatory body responsible for approving electricity tariffs in South Africa. It aims to balance fair prices for consumers with Eskom&#8217;s need to cover costs and invest in infrastructure. Mistakes in tariff calculations can have serious effects on Eskom\u2019s financial health and service delivery as well as on electricity prices paid by consumers.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>Following an assessment of Eskom\u2019s review application, NERSA identified errors that resulted in<br>underestimation in certain components of Eskom\u2019s application, specifically an error on the depreciation<br>amount captured in Table 14 of the decision and reasons for decision document compared to Table 1 of the RAB section. Consequently, this resulted in a shortfall of R14 514 million. The other error relates to an asset transferred for commercial operation, where the cumulative balance principle (rolling forward) was not applied for the generation business, which affected the 2026\/27 and 2027\/28 financial years. <\/p>\n\n\n\n<p>Notwithstanding this error, it must be stated that the cumulative balances principle was properly applied for transmission and distribution businesses. After rectifying these errors, NERSA <a href=\"https:\/\/www.nersa.org.za\/files\/files\/2025\/08\/Mediastatement-NERSAandEskomsettlementontheSixthMulti-YearPriceDeterminationRevenuedecision.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">concluded<\/a> that Eskom was entitled to an additional R54 billion over the three-year MYPD6 period, an amount substantially lower than Eskom\u2019s original claim of R107 billion. The parties settled for R54 billion on 30 July 2025.<\/p>\n<\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"what-are-electricity-tariffs-and-how-do-they-work\">What Are Electricity Tariffs and How Do They Work?<\/h2>\n\n\n\n<p>Electricity tariffs are the prices people pay for using electricity. They cover the costs of producing and delivering power to homes and businesses, including generation, transmission, distribution, and maintenance of the network.<\/p>\n\n\n\n<p>South African tariffs include a fixed connection charge and a variable charge <a href=\"https:\/\/www.ecoflow.com\/za\/blog\/electricity-cost-per-kwh\" target=\"_blank\" rel=\"noreferrer noopener\">based on consumption<\/a> measured in kilowatt-hours (kWh). Some tariffs feature time-of-use rates, charging less during off-peak hours to encourage usage when demand is low. Others have tiered rates, increasing prices as usage rises to promote energy saving.<\/p>\n\n\n\n<p><a href=\"https:\/\/www.eskom.co.za\/distribution\/tariffs-and-charges\/\" target=\"_blank\" rel=\"noreferrer noopener\">Different user groups<\/a> such as households, businesses, or rural customers have distinct tariff structures. Many South Africans receive electricity either directly from Eskom or through municipalities, which may add additional distribution charges. NERSA sets tariffs to balance affordable prices with Eskom\u2019s need to cover operational costs and investments.<\/p>\n\n\n\n<p><em>With electricity prices rising again, every saving counts. Explore smart strategies to cut down your power usage and keep your monthly bills under control. <\/em><strong><a href=\"https:\/\/www.gauteng.net\/whats-on-g\/municipal-electricity-tariff-hikes\/\">Municipal Tariff Hikes: How to Save on Your Electricity Bill in 2025<\/a><\/strong><em>. Click here to learn more.<\/em><\/p>\n\n\n\n<div id=\"gaute-140045320\" class=\"gaute-inbetween-content gaute-entity-placement\" style=\"margin-top: 30px;margin-bottom: 30px;margin-left: auto;margin-right: auto;text-align: center;\"><div class=\"gaute-adlabel\">Advertisement<\/div><script async src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1852772760112594\" crossorigin=\"anonymous\"><\/script><ins class=\"adsbygoogle\" style=\"display:block;\" data-ad-client=\"ca-pub-1852772760112594\" \ndata-ad-slot=\"1819787043\" \ndata-ad-format=\"auto\" data-full-width-responsive=\"true\"><\/ins>\n<script> \n(adsbygoogle = window.adsbygoogle || []).push({}); \n<\/script>\n<\/div><h2 class=\"wp-block-heading\" id=\"why-this-settlement-matters\">Why This Settlement Matters<\/h2>\n\n\n\n<p>The R54 billion settlement is significant for several reasons:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>It highlights the scale of errors in tariff setting.<\/li>\n\n\n\n<li>It signals potential future increases in electricity tariffs.<\/li>\n\n\n\n<li>It draws attention to Eskom\u2019s ongoing financial challenges.<\/li>\n\n\n\n<li>It raises questions about regulatory oversight and accountability.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"impact-on-south-african-households\">Impact on South African Households<\/h2>\n\n\n\n<p>Consumers may see electricity prices rise as Eskom needs to recover the settlement cost. Increased tariffs could strain household budgets. For many South Africans, electricity is a vital service, making affordability a <a href=\"https:\/\/iol.co.za\/business\/2025-08-28-south-africans-could-pay-more-for-electricity-after-nersa-and-eskom-reach-r54bn-settlement\/\" target=\"_blank\" rel=\"noreferrer noopener\">key concern<\/a>. This underlines the importance of accurate and transparent regulatory processes.<\/p>\n\n\n\n<p><em>Power cuts continue to disrupt operations, reduce productivity, and strain profitability. Discover how small businesses are coping and adapting to keep their doors open.<\/em> <strong><a href=\"https:\/\/www.gauteng.net\/whats-on-g\/load-shedding-impacts-small-businesses\/\">How Load Shedding Impacts Small Businesses in Gauteng<\/a><\/strong>. <em>Click to find out more.<\/em><\/p>\n\n\n\n<div id=\"gaute-4209665357\" class=\"gaute-inbetween-content gaute-entity-placement\" style=\"margin-top: 30px;margin-bottom: 30px;margin-left: auto;margin-right: auto;text-align: center;\"><div class=\"gaute-adlabel\">Advertisement<\/div><script async src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1852772760112594\" crossorigin=\"anonymous\"><\/script><ins class=\"adsbygoogle\" style=\"display:block;\" data-ad-client=\"ca-pub-1852772760112594\" \ndata-ad-slot=\"1819787043\" \ndata-ad-format=\"auto\" data-full-width-responsive=\"true\"><\/ins>\n<script> \n(adsbygoogle = window.adsbygoogle || []).push({}); \n<\/script>\n<\/div><h2 class=\"wp-block-heading\" id=\"eskoms-financial-struggles-continue\">Eskom\u2019s Financial Struggles Continue<\/h2>\n\n\n\n<p>Eskom has faced financial difficulties for years, caused by aging infrastructure, costly maintenance, and operational inefficiencies. The recent settlement adds further pressure on its finances. Eskom requires adequate funding to maintain and upgrade its power generation and distribution systems to ensure reliable electricity supply.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>NERSA\u2019s settlement <a href=\"https:\/\/saftu.org.za\/archives\/9046\" target=\"_blank\" rel=\"noreferrer noopener\">confirms that<\/a> electricity prices will rise above inflation for two consecutive years, with tariff increases now set to reach:<\/p>\n\n\n\n<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; \u2022&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8.76% in 2026\/27 (up from 5.36%)<\/p>\n\n\n\n<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; \u2022&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 8.83% in 2027\/28 (up from 6.19%)<\/p>\n<\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"criticism-from-opposition-and-unions\">NERSA Settlement: Criticism from Opposition and Unions<\/h2>\n\n\n\n<p>Political parties and labour unions have criticised the settlement and the way the tariff errors were handled. They call for greater transparency and accountability from both Eskom and NERSA. Some argue the settlement <a href=\"https:\/\/saftu.org.za\/archives\/9046\" target=\"_blank\" rel=\"noreferrer noopener\">reflects broader problems<\/a> with South Africa\u2019s energy policy and management.<\/p>\n\n\n\n<div id=\"gaute-3046889841\" class=\"gaute-inbetween-content gaute-entity-placement\" style=\"margin-top: 30px;margin-bottom: 30px;margin-left: auto;margin-right: auto;text-align: center;\"><div class=\"gaute-adlabel\">Advertisement<\/div><script async src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1852772760112594\" crossorigin=\"anonymous\"><\/script><ins class=\"adsbygoogle\" style=\"display:block;\" data-ad-client=\"ca-pub-1852772760112594\" \ndata-ad-slot=\"1819787043\" \ndata-ad-format=\"auto\" data-full-width-responsive=\"true\"><\/ins>\n<script> \n(adsbygoogle = window.adsbygoogle || []).push({}); \n<\/script>\n<\/div><h2 class=\"wp-block-heading\" id=\"what-does-the-settlement-mean-for-energy-regulatio\">What Does the NERSA Settlement Mean for Energy Regulation?<\/h2>\n\n\n\n<p>NERSA <a href=\"https:\/\/www.nersa.org.za\/files\/files\/2025\/08\/Mediastatement-NERSAandEskomsettlementontheSixthMulti-YearPriceDeterminationRevenuedecision.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">acknowledged<\/a> the tariff errors but, due to the judicial review\u2019s legal framework, cannot revisit the issue. This limits the regulator\u2019s options moving forward while Eskom must absorb the financial impact. The case highlights challenges in balancing regulatory duties with Eskom\u2019s financial needs and consumer protection.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe title=\"Nersa agreement with Eskom | Behind-closed-doors settlement to hit consumers\" width=\"755\" height=\"425\" src=\"https:\/\/www.youtube.com\/embed\/O77vBack00k?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><figcaption class=\"wp-element-caption\"><a href=\"https:\/\/youtu.be\/O77vBack00k?si=9WjsCx-Z48eDOVwc\" target=\"_blank\" rel=\"noreferrer noopener\">YouTube<\/a><\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"moving-towards-sustainable-energy-solutions\">Moving Towards Sustainable Energy Solutions<\/h2>\n\n\n\n<p>South Africa\u2019s energy future depends on addressing Eskom&#8217;s financial issues and modernising the grid. Expanding renewable energy projects and improving energy efficiency are priorities. <a href=\"https:\/\/saftu.org.za\/archives\/9046\" target=\"_blank\" rel=\"noreferrer noopener\">Reforming<\/a> the regulatory environment will also play a vital role in preventing similar issues and ensuring fair tariffs.<\/p>\n\n\n\n<div id=\"gaute-1363718660\" class=\"gaute-inbetween-content gaute-entity-placement\" style=\"margin-top: 30px;margin-bottom: 30px;margin-left: auto;margin-right: auto;text-align: center;\"><div class=\"gaute-adlabel\">Advertisement<\/div><script async src=\"\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-1852772760112594\" crossorigin=\"anonymous\"><\/script><ins class=\"adsbygoogle\" style=\"display:block;\" data-ad-client=\"ca-pub-1852772760112594\" \ndata-ad-slot=\"1819787043\" \ndata-ad-format=\"auto\" data-full-width-responsive=\"true\"><\/ins>\n<script> \n(adsbygoogle = window.adsbygoogle || []).push({}); \n<\/script>\n<\/div><h2 class=\"wp-block-heading\" id=\"what-south-africans-should-know\">Tariff Hike: What South Africans Should Know<\/h2>\n\n\n\n<p>Electricity tariffs <a href=\"https:\/\/iol.co.za\/business\/2025-08-28-south-africans-could-pay-more-for-electricity-after-nersa-and-eskom-reach-r54bn-settlement\/\" target=\"_blank\" rel=\"noreferrer noopener\">may rise to cover<\/a> the R54 billion settlement cost. Consumers can stay informed by following updates from Eskom and NERSA. Energy-saving practices can help reduce electricity bills. Staying aware of energy policies and participating in public discussions is important for all citizens.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"looking-ahead\">Energy Supply<\/h2>\n\n\n\n<p>The Eskom-NERSA settlement is a reminder of the complexities of managing the country\u2019s electricity sector. Transparent regulation, improved governance, and sustainable investments are crucial to secure South Africa\u2019s energy future. The coming months will show how these changes affect electricity users nationwide.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Media Statement &#8211; NERSA and Eskom settlement on the Sixth Multi-Year Price Determination Revenue decision. <a href=\"https:\/\/t.co\/vlAJEU5Fzl\">pic.twitter.com\/vlAJEU5Fzl<\/a><\/p>&mdash; NERSA_ZA (@NERSA_ZA) <a href=\"https:\/\/twitter.com\/NERSA_ZA\/status\/1960744009829138575?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"noopener\">August 27, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><figcaption class=\"wp-element-caption\"><a href=\"https:\/\/x.com\/NERSA_ZA\/status\/1960744009829138575\" target=\"_blank\" rel=\"noreferrer noopener\">X\/Twitter<\/a><\/figcaption><\/figure>\n","protected":false},"excerpt":{"rendered":"<p>South Africans face possible electricity tariff hikes after Eskom and NERSA settle a R54 billion dispute over pricing errors. Learn what this means for consumers.<\/p>\n","protected":false},"author":15,"featured_media":25970,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"rank_math_focus_keyword":"","rank_math_title":"","rank_math_description":"South Africans face possible electricity tariff hikes after Eskom and NERSA settle a R54 billion dispute over pricing errors. Learn what this means for consumers.","footnotes":""},"categories":[47],"tags":[2525,8014,343,5766,5756,3036],"class_list":{"0":"post-25962","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-news","8":"tag-electricity","9":"tag-energy-crisis-south-africa","10":"tag-eskom","11":"tag-nersa","12":"tag-power-supply","13":"tag-tariff-hike"},"_links":{"self":[{"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/posts\/25962","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/comments?post=25962"}],"version-history":[{"count":4,"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/posts\/25962\/revisions"}],"predecessor-version":[{"id":25980,"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/posts\/25962\/revisions\/25980"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/media\/25970"}],"wp:attachment":[{"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/media?parent=25962"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/categories?post=25962"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.gauteng.net\/whats-on-g\/wp-json\/wp\/v2\/tags?post=25962"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}