If you thought electricity pricing was stabilising, think again. A major shake-up by the National Energy Regulator of South Africa (Nersa) means your electricity bill is likely heading up. And if you're a homeowner, landlord, or investor, this isn’t just about monthly expenses. It's about long-term property value, return on investment, and energy efficiency planning.
Let’s break it down, because the changes are significant, and the impact on the South African property market will be felt for years.
What’s Happening With Electricity Tariffs?
In a rare move, Nersa recently revised its price determination after discovering errors in its January announcement. The result? An electricity tariff increase of 8.8% per year for 2026-2027 and 2027-2028, almost triple the consumer inflation rate.
This comes after Eskom launched a judicial review to challenge the original figures, claiming it had been short-changed by R107 billion. After negotiations, Nersa agreed that R54 billion in additional recoverable revenue was justified. And because the matter was settled privately, there was no public consultation.
Why Should Property Owners Care?
If you own property in South Africa, your operating costs are about to rise. Whether it’s a residential unit, multi-family block, or commercial space, electricity pricing impacts tenant satisfaction, occupancy rates, and ultimately your bottom line.
Here's how:
- Landlords will feel pressure to absorb or pass on the tariff increases.
- Homeowners may consider alternative energy sources sooner.
- Buyers will assess energy costs in property valuation.
- Sellers with energy-efficient homes gain a market edge.
This isn’t just about paying more. It’s about planning smarter.
Behind the Numbers: The MYPD Methodology
The multi-year price determination (MYPD) model is how Nersa sets tariffs. It factors in Eskom’s costs, depreciation, and return on assets. In this case, Nersa found issues in:
- Depreciation calculations
- Asset transfers in Eskom’s generation business
Fixing these led to Eskom being allowed to recover an additional R54 billion from customers. While financially logical, it’s a tough pill for the already stretched property sector to swallow.
No Public Hearings? No Problem?
Usually, tariff changes include a public participation process. Not this time. The negotiated settlement agreement avoided prolonged litigation, which Nersa claimed would’ve delayed implementation even further.
Nomfundo Maseti, Nersa’s Full-Time Regulator Member for Electricity Regulation, said:
“This settlement agreement represents a fair and balanced resolution… safeguarding consumers while ensuring Eskom’s operational sustainability.”
In short? This is happening. Now’s the time to get ready.
What Smart Property Owners Should Do Now
Don’t wait for higher bills to catch you off guard. Be proactive with these steps:
- Conduct an energy audit – Understand your current usage and inefficiencies.
- Invest in efficiency – Think solar panels, LED lighting, and smart meters.
- Renegotiate leases – Factor rising costs into contracts with tenants.
Staying ahead of electricity tariff increases means protecting your investment and keeping your property attractive in a high-cost environment.
Stay Ahead or Fall Behind
South Africa’s energy landscape is changing fast. With tariff increases confirmed and public consultation skipped, it’s now on property owners to prepare.
Energy efficiency is no longer just a buzzword. It’s a survival strategy in the real estate game.
🔍 Key Takeaways
- Electricity tariffs rising by 8.8% annually from 2026.
- Nersa revised its price determination after Eskom's judicial review.
- R54 billion to be recovered from customers over 2 years.
- No public hearings due to settlement.
- Property owners must plan now for rising operating costs.