Understanding Your Electricity Bill: How Eskom Tariffs Work
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Since 1 April 2025, direct Eskom residential customers no longer pay an Inclining Block Tariff: every kWh costs the same, and the bill is split into a per-kWh charge and fixed daily charges (NERSA decision of 11 March 2025, implemented by Eskom from 1 April 2025). For 2026/27, NERSA approved an average 8.76% increase for customers who buy directly from Eskom, from 1 April 2026. Municipalities pay Eskom a separate bulk tariff, which rises 9.01% from 1 July 2026. That is what municipalities pay Eskom, not the increase on a household’s municipal bill: each municipality sets its own retail tariff, and some, such as City of Cape Town, still use block tariffs.
Fixed Costs vs Variable Usage
On Eskom’s Homepower tariffs your bill has two parts: a per-kWh charge that grows with usage and fixed daily charges you pay even if you use nothing. Many South Africans focus only on usage and miss the fixed part.
For Homepower 2 (a common size for larger homes), the 2026/27 charges including VAT are:
- Per kWh: about R3.56 (energy 322.06c + ancillary 0.52c + network demand 32.98c)
- Fixed per day: about R42.68 (network capacity R33.86 + service and administration R6.60 + generation capacity R2.22)
A household using 400 kWh in a 30-day month would pay roughly R1,422 for usage (400 kWh at355.56c) plus R1,280 in fixed charges, about R2,700 in total. Fixed charges are close to half of that bill, and the share is higher the less you use. Eskom moved more of the service and administration charge into the fixed portion in 2026/27.
Prepaid vs Monthly Billing
Prepaid versus monthly billing is how you pay, not a separate tariff. A Homepower customer can pay by monthly invoice or by prepaid voucher, and the fixed daily charges still apply either way: prepaid just bundles them into the c/kWh rate you see. Homelight is Eskom’s low-income tariff and is prepaid only, with a single per-kWh charge and no fixed daily charge, in a 20A and a 60A supply size. Which tariff you are on depends on your supply size and meter, so check your bill or meter before comparing.
| Tariff | Per kWh (incl. VAT) | Fixed daily charges | Best For |
|---|---|---|---|
| Homepower 2 (monthly or prepaid) | about R3.56 | about R42.68/day | Larger homes, regular usage |
| Homelight 20A (prepaid) | R2.70 | None | Low-usage households |
| Homelight 60A (prepaid) | R3.44 | None | Larger prepaid supplies |
Source: Eskom’s Schedule of Standard Prices, 1 April 2026 to 31 March 2027 (Tables 12 and 14). Increases and structure: NERSA media statement, Eskom implementation notice and the NERSA decision of 11 March 2025. Block tariffs: City of Cape Town tariffs.
Municipal Markup
If you buy electricity from your municipality (not directly from Eskom), the municipality sets its own tariffs, which are usually higher than Eskom’s direct rates and vary widely. The rates shown by the calculator are Eskom direct rates, so check your municipality’s published tariffs and your own bill.
Free Basic Electricity
Qualifying indigent households receive 50 kWh per month free. This covers basic lighting and small appliances. Registration is through your local municipality. The 50 kWh allowance was introduced to ensure even the poorest households have access to basic electricity.
Tips to Reduce Your Bill
The biggest household electricity consumers are geysers (40–50% of the bill), electric stoves, heaters, and pool pumps. Installing a geyser timer, switching to LED lighting, and using gas for cooking can significantly reduce usage. Solar water heating alone can cut your bill by 30–40%.