050910 Electricity pylons carry power from Cape Town's Koeberg nuclear power plant July 17, 2009. South Africa will need 20 gigawatts (GW) of new power generation capacity by 2020 and would require double that amount a decade later to meet rising demand, the country's power utility said September 7, 2009. Picture taken July 17, 2009. REUTERS/Mike Hutchings (SOUTH AFRICA ENERGY BUSINESS)

The 16 percent electricity tariff hike every year for the next five years is unavoidable, Public Enterprises Minister Malusi Gigaba said on Tuesday.

“It (the tariff increase) is not fair, (but) it is necessary,” Gigaba said at a business breakfast in Fourways.

“Given the challenges that we have... we need to ask South Africans to bare the collective pain to fund this build programme and go through this painful process.”

In October, Eskom submitted an application to the National Energy Regulator of SA for a 16 percent tariff hike every year for the next five years.

Gigaba said the poor needed to continue to be shielded. They would be charged a single-digit flat rate determined by municipalities.

Eskom asked municipalities to be considerate of their mark-up when charging more for electricity, as it was a source of revenue, Gigaba added. - Sapa