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How Eskom's electricity hike will affect pensioners

Published Mar 12, 2019

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Durban - Pensioners, already buckling under the pressure of food and fuel increases, may be one of the hardest affected by the  National Energy Regulator of South Africa's decision to grant Eskom an above-inflation increase for electricity, a non-government agency has said.

Last week Nersa announced that they had granted Eskom a 9.41 per cent increase for 2019/2020; 8.10 per cent increase for 2020/2021 and 5.22 per cent increase for 2021/2022. Eskom had asked the energy regulator for a 15 per cent increase every year for the next three years.

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Julie Smith, a researcher at Pietermaritzburg Economic Justice and Dignity Group said currently an average low-income household uses about 350kWh per month. 

“In Pietermaritzburg currently 350kWh costs R529,34 on prepaid meters.  A 13,8% increase in electricity tariffs will increase the cost of 350kWh from R529,34 to R602,38 per month. This is an increase of R73, 04. The old-age grant was increased by R80 or 4,7%, coming into effect on 1 April 2019 (from R1 700 to R1 780),” she said.

Smith said that besides the 13.8 per cent, municipalities would add on their own charges to cover the costs of them providing electricity to the public. 

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The additional municipal charges would wipe out the little money left from the increase. Smith said this also did not factor in the cost of rising electricity prices would have on food and transport costs which will hit the poor the hardest and that the situation for the elderly was going to be worse than last year. 

“Pensioners have been advocating for a substantial increase in the old-age grant because the old-age grant is set at a poverty level. This year's increase of R80 is even lower than the R100 granted last year, yet the cost of goods and services continue to increase and the jobs crisis has not improved,” Smith said. She said that households depending on pensions would find themselves in harder positions," she said.

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