Using August 2025 as the reference, many South Africans would still be witnessing rising electricity tariffs, in terms of Multi-Year Price Determinations accepted by energy regulator NERSA. Eskom initially requested an unrealistic 36 % hike for FY 2025/26, but the regulator allowed a more modest elevated increase of 12.7 %, now to be phased through the year, with municipal customers seeing the bulk of the increase of 11.3 % from 1st July 2025, while direct customers, typically households and businesses, will see an increase of 12.74 % from 1st April 2025.
What this means is that while the main tariff adjustment came into effect on 1 April 2025, the full impact on electricity bills becomes more visible towards the end of August 2025, as the billing cycles would be reflecting new rates. For a household consuming roughly 600 kWh per month, monthly bills should rise to approximately R1,491, which is a steep increase over previous years.
Why the hike?
Eskom had sought a substantial 36.15% increase to align prices with rising costs—from coal contracts, carbon taxes, aging infrastructure, and municipal debt recovery. The Multi-Year Price Determination 6 (MYPD6) proposed steep increases over three years (36.15% in 2025/26; 11.81% in 2026/27; 9.1% in 2027/28). But NERSA, balancing financial sustainability with affordability, approved only a portion—12.74 % in year one, and more modest increases of 5.36 % in 2026 and 6.19 % in 2027.
Who hits harder?
Increasing energy costs pose a big problem for low-income consumers, many already outlaying in excess of half their relatively low income towards electricity bills. Pensioners and recipients of social grants are particularly susceptible to these above-inflation increases.
SMMEs with energy-intensive activities, along with agriculture and manufacturing industries, could see their operational costs increase, eat into profitability, and lose their competitive edge.
Municipalities, with their deepening unpaid debt levels (estimated to be R110 billion by 2025), will pass the cost onto consumers as they increase tariff rates, adding further pressure to those already feeling it.
Public backlash and governance considerations
Consumer body OUTA cried foul at a price increase anyway, citing it as still “three times the inflation rate” without justification because of ongoing governance concerns. Noted aside were losses stemming from prepaid meters (ghost vending), corruption, and inefficient distribution costs that run into billions for Eskom each year. The argument is that Eskom needs to cut costs internally rather than charging consumers more.
Expanded impacts and mitigation strategies
Hike in electricity has added to inflationary pressures in South Africa, with an increase in the cost of goods and services. Being greedy for land and other resources, many consumers and businesses have started setting up alternative energy resources-those rooftop solar power systems, hybrid energy systems, and private power-producing companies-which intermediate the process of reducing Eskom’s hold and dilute the risk of load shedding.
The government interventions are on the way to unbundling Eskom (generation, transmission, distribution), initiate a fresh round of renewable procurement under REIPPPP, and rally international finance (for example, a $500 million injection by the Climate Investment Fund tied to a wider R47 billion climate finance package).
Looking forward
The 12.7% effective increase from April in the August billing cycles hardly bears Eskom’s request for a 36% increase. NERSA’s compromise decision speaks to trying to secure Eskom’s solvency without ruining household and business budgets. This price increase is faster than the general increase in inflation and thus severely affects vulnerable communities and enterprises.
In the long-term perspective, South Africa’s energy strategy prefers an equitably transition to renewables, more efficiency with Eskom and municipalities, and access to private generation. Until then, this raise in August has registered its presence to show that electricity, once fairly steady and affordable, is now being discussed within South Africa in terms of equity, economic stability, and national resilience.
Also Read: South Africa New Electricity Laws For 2025: What You Need To Know