23/02/2017 18:51 GMT | Updated 23/02/2017 18:54 GMT

Eskom Electricity Prices Go Up By 2.2% From April

Municipalities will increase their prices from July.

REUTERS/Siphiwe Sibeko
Eskom electricity pylons, Soweto, South Africa.

The National Energy Regulator of South Africa (Nersa) has granted the state electricity utility a 2.2 percent price increase.

The increase is for 2017/18, said Nersa in a statement.

Eskom's new financial year starts on April 1, so the increase is effective from then.

This is the final year of the third multi-year pricing agreement authorised by Nersa, referred to as the MYPD3.

"The allowed revenue for 2017/18 is Eskom's full year's revenue as determined in the MYPD3 decision. The allowed revenue will be able to cover all of Eskom's allowed costs, plus a return to the value of R33,667 million [R33.667 billion] as per the MYPD3 decision. The allowable revenue also includes an amount of R23,018 million for the Independent Power Producer (IPP) purchases as a cost passthrough in line with the MYPD3 methodology," said Nersa.

Eskom's direct customers will start being charged the extra from April. Although those customers include the municipalities, which in turn resell the electricity to their customers, and the municipalities will have to pay that increase, the municipalities may not increase their charges until their own new financial year which starts in July.