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For most South Africans, electricity pricing is not an abstract policy question.
It is felt every month when the electricity bill arrives, when a prepaid meter runs down faster than expected, or when a small business has to decide whether it can afford to expand, employ another person or keep its doors open.
This is why the revised electricity pricing policy (EPP) 2026, currently open for public comment, matters to every South African.
Our electricity sector is changing fundamentally. The system that existed when the 2008 electricity pricing policy was developed was largely centred on a vertically integrated Eskom.
Today, the sector is moving towards an unbundled and increasingly competitive electricity market, with independent power producers, municipalities and private generators playing a greater role. Renewable energy, battery storage, embedded generation and new technologies are also changing how electricity is produced, supplied and consumed.
Our pricing framework must keep pace with this transformation. At the heart of the revised EPP is a simple principle: electricity prices should increasingly reflect the efficient cost of providing electricity, while ensuring that affordability and social equity remain central considerations.
The policy seeks to create a transparent and predictable pricing framework that can support investment in generation, transmission and distribution infrastructure while protecting access to electricity for vulnerable households.
This does not mean abandoning poor households to market forces. On the contrary, the policy explicitly recognises that subsidies for low-income domestic customers will remain necessary for at least the next 10 years.
It proposes a combination of state support for network capital costs, low connection fees, lifeline tariffs and free basic electricity. Qualifying households would be protected through a lifeline tariff designed around low consumption and affordability.
The challenge is to ensure that such support reaches those who need it while making the system transparent and financially sustainable.
The revised EPP therefore proposes a national subsidy framework to establish clear rules about who contributes to subsidies, who receives them and how much support should be provided. Subsidies should be transparent rather than hidden within electricity prices.
This is important because South Africans deserve to understand what they are paying for and, where applicable, who is being supported through the electricity pricing system.
Transparency is equally important on the electricity bill. The policy proposes that bills should provide a clearer breakdown of the different components of the electricity price, including energy, network and service costs, as well as applicable subsidies and surcharges.
Better information will allow consumers to understand their consumption and make more informed decisions about how and when they use electricity.
Predictability is another important reform. Electricity users need to plan, households need to manage their budgets, businesses need to make investment decisions, and municipalities need to plan.
The revised EPP therefore proposes that the National Energy Regulator of South Africa develop and publish a multiyear electricity price path covering at least five years, updated periodically and aligned with the country’s integrated resource plan.
The policy also seeks to create a more open and competitive electricity system. Fair and non-discriminatory access to transmission and distribution networks will be essential as more customers procure electricity from different suppliers and as electricity wheeling expands. The objective is to ensure that the country’s electricity infrastructure can be used efficiently for the benefit of all participants.
A modern electricity pricing framework must support investment, encourage efficiency and enable the electricity sector to become financially sustainable. At the same time, it must recognise that electricity is an essential service and that affordability cannot be separated from the country’s broader social and economic objectives.
The revised EPP is therefore not simply about changing tariffs; it is about creating the rules for a changing electricity sector.
It is about making prices more transparent, supporting investment in the infrastructure we need, encouraging efficient electricity use, protecting vulnerable households and creating a regulatory environment in which competition and innovation can flourish.
But a policy of this importance cannot be developed in isolation, and this is the reason the department of electricity and energy has deliberately published the revised EPP for public comment because the experiences and views of South Africans matter.
Consumers, businesses, municipalities, organised labour, industry bodies, civil society, researchers and other stakeholders are encouraged to engage with the proposals and help shape the final policy.
The invitation to comment is an invitation to participate in the future of South Africa’s electricity sector.
Our objective is clear: to build an electricity pricing system that is fair, transparent, predictable and sustainable — one that supports economic growth while ensuring that no South African is left behind.
- Buthelezi is the head of communication in the department of electricity and energy
Sowetan
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