S.African electricity prices more expensive than Zimbabwe and Zambia

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South Africa has the eighth-cheapest electricity in Sub-Saharan Africa and the 48th cheapest in the world, researchers at Cable.co.uk have found.

Countries in the region with cheaper power than South Africa include Tanzania, Zambia, Ethiopia, Guinea, Zimbabwe, Sudan, and Angola.

“Sub-Saharan Africa has four of the top ten cheapest countries in the world and three of the top ten most expensive,” the researchers noted.

Angola is the cheapest in the region and second-cheapest globally, with an average price of R0.21 per kWh. Sudan is a close second with R0.23, and Zimbabwe is third with R0.34.

Average electricity prices in South Africa have surged by over 582% since load-shedding was first implemented in 2007.

The utility slapped an average increase of 15.06% on tariffs for the 2020/2021 financial year.

This year also saw Eskom implement the greatest amount of load-shedding in 14 years.

Cable.co.uk’s research analysed 3,883 energy tariffs worldwide, measuring the price of electricity in 230 countries.

“Unlike similar studies conducted by Cable.co.uk into global broadband package pricing and global mobile data pricing, few regional patterns emerged in the study results,” the researchers stated.

They noted that clusters of more expensive countries to buy electricity tended to be in small island nations where electricity is harder to generate, or there are no large scale power stations.

“Conversely, the cheapest places in the world to buy electricity tend to be countries where either oil and gas prices are very cheap—i.e. countries which produce fossil fuels on a large scale—or where household electricity usage is very small and therefore tends not to require a lot of expensive infrastructure.”

Examples of countries with more expensive electricity than South Africa, on average, are China, India, Norway, Brazil, the United States, Canada, New Zealand, Australia, Japan, and the United Kingdom.

The following table summarises the ten countries with the cheapest electricity prices in Sub-Saharan Africa, with their global rank and average price per kilowatt-hour shown.

Prices were changed to rand using the conversion factor used by the researchers — roughly R16.20 per dollar.

Cheapest electricity in Sub-Saharan Africa

Global rank Country Average price of 1kWh (ZAR)
2 Angola R0.21
3 Sudan R0.23
5 Zimbabwe R0.34
8 Guinea R0.53
11 Ethiopia R0.57
41 Zambia R0.91
42 Tanzania R1.12
48 South Africa R1.23
54 Lesotho R1.31
64 Malawi R1.49

Eskom recently warned that changes being proposed to how power prices are calculated in South Africa would increase electricity costs.

The state-owned power utility recently challenged the National Energy Regulator of South Africa (Nersa) and won an interim order in its favour.

Judge Jody Kollapen ordered Nersa to process Eskom’s tariff applications for 2022/23 that it submitted in June.

Nersa rejected the application and told Eskom to resubmit them using a new methodology.

The regulator said it plans to base its future price determinations on a new methodology that will take the rapid transformation of the electricity sector into consideration.

Eskom said it would be impossible for it to resubmit the tariff applications in time to be approved, which would block the power utility from charging for electricity.

Judge Kollapen agreed with Eskom’s argument that Nersa’s existing methodology can only lapse if the regulator replaces it with something else, as failing to do this would leave a vacuum — which would be illegal and impractical.

According to reports, Nersa plans to continue its battle with Eskom to apply its new method for calculating the cost of electricity during 2023/24.

Eskom says that if Nersa persists, it could result in higher electricity prices.

Nersa would need to compensate Eskom for higher risk, the power utility stated.

Source: https://mybroadband.co.za/news/technology/426474-eskom-electricity-prices-more-expensive-than-zimbabwe-and-zambia.html

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