Are you paying more for electricity than other towns?
Depending on which Northern KwaZulu-Natal town you live in, your electricity bill could be 37% higher than that of a resident in a neighbouring town, using exactly the same amount of power.
A comparative study of electricity costs in the licensed distribution areas of five NKZN municipalities – Newcastle, Alfred Duma (Ladysmith), Endumeni (Dundee), AbaQulusi (Vryheid) and Inkosi Langalibalele (Estcourt) – has revealed how much cheaper or more expensive electricity is, depending on where you live.
Asked ‘Which town do you believe charges its residents the most for electricity?’, readers answers differed according to the town they live in.
A general mistrust of local Government and the feeling of being ‘ripped off’ leads most to believe they must be paying more for electricity, as corrupt officials and politicians aim to line their pockets with ratepayers’ money.
“Newcastle (pays more), obvious… just to cover their debt,” said Mduduzi Nhlabathi, who resides in Newcastle.
“This is a rip off. Ladysmith!!!! (pays more) Something must be done,” commented Sbongile Nxumalo.
“Estcourt is worse,” believes Nozipho KaMashobane.
“It has always been Endumeni (Dundee),” declared Cecilia Gold.
All five municipalities have opted for a step tariff instead of a flat rate.
This means the charge per unit of electricity increases, as your consumption increases.
A step tariff is designed to encourage residents to save electricity, and to ensure the poor, who may only require electricity for basic needs like cooking and lighting, pay a lower more affordable tariff than a homeowner who for instance, runs more than one geyser, a pool pump and air-conditioners.
Basically, the less you use, the lower the tariff you will pay.
Residents in Dundee and Estcourt do not pay a basic or availability charge.
This is a set monthly cost residents in Newcastle, Ladysmith and Vryheid must pay, regardless of whether they consume electricity or not.
The availability charge for electricity in Newcastle is more than double the basic charge in Ladysmith or Vryheid.
Working on the step tariff model as well as the basic charge for conventional meters, we calculated three different hypothetical electricity accounts for each town.
The first is based on a consumption of 1 000 kilowatt-hours’ usage for a given month (average consumption).
The second is based on a consumption of 500kwh usage (low consumption), and the third is based on a consumption of 1 500kwh usage (high consumption).
Average and high usage consumers paid the most in Ladysmith, where residents pay roughly 30% more for electricity than residents in Estcourt, where electricity costs are lowest.
Despite Newcastle being described at the largest town of the five, households within this municipality’s licensed area of distribution pay the second-lowest for electricity, among those we compared.
In order from most expensive to least expensive, based on 1 000kwh usage, Ladysmith was most expensive, followed by Vryheid, Dundee, Newcastle and Estcourt was cheapest, with residents in Ladysmith paying 32% more for electricity than residents in Estcourt.
Based on 1 500kwh usage, Ladysmith was still most expensive, followed by Dundee, Vryheid, Newcastle and Estcourt was cheapest, with residents in Ladysmith paying 27% more for electricity than residents in Estcourt.
When we looked at lower consumption of 500kwh however, Newcastle proved to be the most expensive, followed by Ladysmith, Vryheid, Dundee and Estcourt was still cheapest, with residents in Newcastle paying 37% more for electricity than residents in Estcourt.
The combination of the step tariff and the availability charge in Newcastle makes the cost of electricity much higher than any of the other towns, for consumers who are trying to save electricity.
This is evident again when you compare what happens when you increase your electricity usage.
Increasing usage by 200% (from 500kwh to 1 500kwh) in Dundee, will see your electricity bill go up by 282% (in Rand value, from R911,44 to R3 475,23), while similarly tripling your usage in Newcastle will only see you electricity bill go up by 166% (in Rand value, from R1 051,57 to R2 791,51).
How do four out of five NKZN towns avoid load-shedding?
Stage 2 load-shedding was endured on sufferance by most South Africans, who resigned themselves to daily power cuts this month, as Eskom grappled with unplanned breakdowns, boiler tube leaks and the failure of a conveyor belt supplying Medupi Power Station with coal.
The disruption of power to major metros led to matrics being unable to write their Computer Application Technology exams and had a detrimental effect on businesses, according to national media reports.
In the NKZN interior however, four out of five municipalities interviewed by Caxton Local Media avoided power cuts.
Newcastle Municipality is more than R200-million in debt with Eskom, and recently had to obtain an interim high court interdict to prevent Eskom from switching off power due to non-payment.
The court order compels this municipality to pay R30-million a month to Eskom, which doesn’t even cover its current account, let alone address its historical debt, yet the residents who receive electricity supply from this municipality have never experienced load-shedding.
On the other hand, residents who receive supply from Endumeni Municipality (Dundee and Glencoe) experienced daily power cuts while this municipality owes Eskom nothing, having ensured it pays its monthly account on time.
Alfred Duma Municipality (Ladysmith), AbaQulusi Municipality (Vryheid), and Inkosi Langalibalele Municipality (Estcourt) also put means in place to avoid power cuts during load-shedding.
Escourt and Vryheid have payment arrangements in place to pay off historical debt owed to Eskom, while Ladysmith, like Dundee, is up to date with its monthly account. How are some municipalities, like Newcastle, able to protect residents from load-shedding, while others, like Dundee, implement daily power cuts… And how do Ladysmith and Dundee manage to pay Eskom on time every month, while Newcastle, Vryheid and Estcourt have amassed R300-million debt cumulatively?
Vryheid: R33-mil Eskom debt, 1 000 houses disconnected for tampering
AbaQulusi Municipality (Vryheid) uses ripple relay switches to switch off geysers and street lights when load-shedding is required, and in doing so, avoids the need to cut off power to its residents.
This municipality ran into Eskom debt after its bank account was attached by a property developer, in a case of land expropriation gone wrong.
It currently owes Eskom about R33-million but is no longer at risk of being switched off, as it is has adhered to the payment arrangement it signed to pay off the outstanding amount.
Grant Bradbury, an official in the Debt Collection Department, believes one of the biggest threats to service delivery is non-payment, and felt it important to instil a culture of accountability among residents to ensure municipalities are able to afford to render services. “In AbaQulusi, we managed to reduce the number of illegal connections in our distribution area from 50% to 10% by increasing our tampering fee to R30 000 for domestic users and R200 000 for business users. At the moment, about 1 000 houses are disconnected due to non-payment or tampering.
“Municipalities need to protect their revenue sources and ensure people are paying for services in order to function effectively. At the same time, I believe every household should invest in a backup supply, a Jojo tank for water, and a generator for electricity.
“Some factors threatening supply of these resources are out of our control,” advised Bradbury.
ALSO READ: AbaQulusi Municipality banking detail confusion cleared
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