Enerthia Energy works across four offerings — Energy Consultancy, Business Development, Product and Service Endorsement, and Funding Origination. This week’s briefing sits squarely in the first of them, because the question in front of most commercial and industrial operations right now is an analytical one before it is a technical or a commercial one: what have South Africa’s approved electricity tariff increases already committed your business to over the next two years, and what does that do to a budget built on something gentler?
The electricity tariff increases are approved, not forecast
On 5 March 2026 the National Energy Regulator of South Africa approved an average electricity price increase of 8.76% for customers supplied directly by Eskom, effective 1 April 2026. Municipal bulk purchasers received an average of 9.01%, implemented from 1 July 2026 — the gap between the two percentages is a matter of financial-year timing under the Municipal Finance Management Act, not a separate decision. In the same redetermination the regulator approved 8.83% for the following financial year, effective 1 April 2027, in place of the 6.19% originally set out under MYPD6.
Compound the two and R100 of electricity in March 2026 becomes R108.76 from April 2026, and R118.36 from April 2027. That is 18.4% across two financial years, already decided and already scheduled.
What that does to a budget
Take an operation spending R1 million a year on electricity and hold the budget line flat. The first year costs R1 087 600. The second costs R1 183 635. The shortfall is R87 600 in year one and a further R183 635 in year two — R271 235 of unbudgeted operating cost across twenty-four months, on a single line item, for a business that changed nothing about how it buys energy.
That is not a variance to explain after the fact. It is a known quantity, and there is still time to act on it.
Why the national average is the wrong number to plan on
The municipal increase is an average across 176 licensed municipal and private distributors, and the spread beneath it is wide. Cape Town approved the lowest increase in the country at 7.5%. Johannesburg’s City Power came in at 8.63% and Tshwane at 8.7%. Nelson Mandela Bay approved 9.5%, eThekwini 10.09%, Ekurhuleni 12.7%, and Buffalo City the steepest at 14%.
A group with sites in Cape Town and East London is absorbing two very different cost curves under one budget. Planning off the national figure understates one and overstates the other, and neither error is cheap.
It is worth understanding why the increases exceeded the original schedule. In late 2025 the High Court rejected a closed-door settlement between the regulator and the utility over an additional R54.7 billion, ruling that the public had to be consulted. The regulator ran that consultation and completed a redetermination in February 2026, phasing recovery at R12 billion in 2026/27, R23 billion in 2027/28, and the remaining R19.7 billion beyond the current determination period. That is what moved 2026/27 from the 5.36% originally scheduled to the 8.76% actually implemented.
Measure before you install
The conversation usually jumps straight to solar, storage or wheeling. It should not, at least not first. The first move is a measurement decision, not a technology one.
Energy Consultancy is where that starts: the actual tariff structure each site sits on, the approved increase for that specific municipality, the load profile behind the account, and what the next two years do to it. Business Development builds the commercial route, because knowing the number is not the same as having a counterparty, a structure and a timetable. Product and Service Endorsement puts the technical solution and the suppliers behind it under scrutiny before capital is committed. And Funding Origination arranges the capital, so a project that survives the analysis does not then stall waiting for a balance sheet.
An operation that installs before it measures buys a solution to a problem it has not defined. One that measures first knows which sites carry the steepest increase, which sit on the wrong tariff structure, and which would genuinely benefit from generation, storage or wheeling.
The most expensive option on the table is the one that requires no decision at all. Absorbing an approved 18.4% over two years, on top of average annual increases approaching 15% over the past five years, is still a decision — it is simply one taken by default. The arithmetic is public and the decisions have been taken. What remains open is what each operation chooses to do with the two years it can still see clearly.
Further briefings are available in the Enerthia Energy Resources library.