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Electricity prices in South Africa well above average — and more expensive than most parts of Africa – MyBroadband

Electricity prices in South Africa well above average — and more expensive than most parts of Africa – MyBroadband

According to GlobalPetrolPrices, electricity prices for households in South Africa are well above the average rate in 144 countries and more expensive than in most African countries.

The vast majority of South Africa’s electricity supply comes from Eskom.

For many years, from its founding through the first decade of South African democracy, Eskom enjoyed among the cheapest electricity prices in the world.

Annual price increases were generally well below inflation. There was even a small price decrease between 2003 and 2004.

That all changed in 2007, when the first power shutdown took place.

Since then, most tariff increases have been significantly faster than inflation, as Eskom’s service costs have soared due to increased use of expensive emergency power supplies, mounting municipal debt and a rise in illegal connections.

Overall, electricity prices have increased by more than 1,722% over the past three decades, compared to inflation of 451.9% over the same period.

South Africa has since lost its claim to being one of the world’s cheapest electricity countries, according to a comparative analysis by GlobalPetrolPrices.com.

The website uses official sources, including utility companies and energy regulators, to regularly compare electricity and fuel prices across countries.

According to the most recent publicly available electricity price data, the average electricity rate per kWh for households in South Africa was approximately R3.29 in December 2023.

That amount is 16.2% higher than the average of R2.83 across 144 countries.

Overall, South Africa has the 95th most affordable electricity tariff. Looking at it from the other side, it is the 54th most expensive.

The country’s tariff is also the second most expensive of the ten countries in southern Africa, surpassed only by Zimbabwe.

In addition, it was interesting to note that electricity tariffs in South Africa were higher than in many neighbouring countries, including those that import a large proportion of their electricity from Eskom.

For example, the average electricity tariff in Botswana is around R1.70, over 48% lower than in South Africa.

And this while approximately 71% of the electricity capacity comes from Eskom.

Eswatini, formerly Swaziland, is even more dependent on Eskom, with about 80% of its water supply coming from the utility.

However, the average electricity rate of R2.10 is still over 36% cheaper than that of South Africa.

The only neighbouring country with higher rates than South Africa is Zimbabwe, which is in trouble.

Considering that the economy and the value of the local currency have been in serious trouble for decades, the rate per kWh, which is about 50% higher than that of South Africa, may not be so bad after all.

On the positive side, households in South Africa generally pay less for electricity than households in developed countries in Europe, which have seen sharp price increases in recent years, partly due to rising natural gas prices as a result of the Russia-Ukraine conflict.

The table below compares average electricity rates in South Africa with those of 30 other countries, including all countries in southern Africa.

South Africa Electricity Rates vs 30 Countries
Country Average rate — December 2023 Difference with South African rate
South Africa R3.29 n/a
Iran (least expensive) R0.05 -98.63%
Rwanda R0.29 -94.05%
Angola R0.25 -92.53%
Nigeria R0.27 -91.89%
Argentina R0.36 -89.03%
Zambia R0.41 -67.98%
Democratic Republic of Congo R1.05 -65.83%
Russia R1.13 -64.40%
Malawi R1.17 -58.56%
India R1.41 -57.32%
United Arab Emirates R1.45 -56.11%
Tanzania R1.57 -52.40%
Botswana (71% supplied by Eskom) €1.70 -48.48%
Lesotho (20% supplied by Eskom) R1.83 -44.53%
Eswatini (80% supplied by Eskom) R2.10 -36.36%
Canada R2.27 -30.98%
Mozambique €2.30 -30.04%
Namibia €2.57 -22.08%
Brazil €2.79 -15.40%
United States €2.94 -10.84%
New Zealand R3.54 +7.56%
Kenya R4.51 +36.97%
Australia €4.88 +48.32%
Zimbabwe €4.96 +50.61%
France R5,08 +54.28%
The Netherlands €5.69 +72.75%
Germany R7.22 +119.23%
United Kingdom R7.24 +119.93%
Bermuda (Most expensive) €9.42 +186.21%

More bad news on the horizon

The publicly available data from GlobalPetrolPrices does not yet include Eskom’s price increases for the current financial year. These have been implemented for direct customers from April 2024 and for municipal customers from July 2024.

Given that price increases were well above inflation, it is likely that South Africa has fallen further down the rankings, assuming that price increases in other countries have since more closely followed inflation.

Eskom is expected to continue to hike rates above inflation for the foreseeable future, with a particularly shocking adjustment potentially in the offing next year.

Daily Maverick has obtained a confidential draft document outlining Eskom’s proposed electricity tariff adjustments for the 2026-2028 period.

It revealed that Eskom planned to apply to South Africa’s national energy regulator for a 36.15% increase in tariffs for direct customers in the 2025/2026 financial year and a staggering 43.55% increase for municipalities.

The graph below shows how Eskom’s electricity tariffs have increased since 1994, compared to what tariffs would have increased based on inflation.

Electricity prices in South Africa well above average — and more expensive than most parts of Africa – MyBroadband