SOUTH Africa is proposing its biggest overhaul of electricity pricing policy in almost two decades, with reforms designed to give commercial and industrial customers greater certainty over future costs and more choice over where they buy power, Bloomberg reported.
The proposed framework is expected to be gazetted on Friday, 21 August.
Suggested reforms include a 10-year electricity price forecast, more transparent and unbundled tariffs, and an expansion of negotiated pricing agreements beyond mining, according to Electricity Minister Kgosientsho Ramokgopa.
Under the proposals, Eskom and municipalities would allow customers to purchase electricity from alternative suppliers while charging transparent, cost-reflective and non-discriminatory network fees.
The regulator would also publish a decade-long price outlook, potentially giving businesses and investors greater visibility when budgeting and assessing returns on capital-intensive projects.
The changes come as electricity costs remain a major concern for energy-intensive businesses. Eskom’s directly supplied customers received an 8.8% tariff increase in July, while customers supplied through municipal distributors faced an average 9% rise.
The proposals also build on efforts to provide targeted relief to industries where power costs threaten competitiveness.
Eskom has already granted tariff relief to ferrochrome smelters operated by the Merafe Glencore Venture and Samancor and has considered lower tariffs for manganese smelter Transalloys, Miningmx reported in July.
Eskom CEO Dan Marokane said earlier broader assistance would require common rules rather than special arrangements for individual companies.
That could be particularly significant for platinum producers and other large industrial users, which have argued that electricity costs are eroding South Africa’s competitiveness.
A standardised negotiated-price agreement with regulatory oversight is among the proposed reforms.
