HomeNewsInclining Block Tariffs benefit low income domestic customers in SA

Inclining Block Tariffs benefit low income domestic customers in SA

14 June 2012 – The introduction of Inclining Block Tariffs (IBTs) is benefitting low income domestic customers in South Africa. This is according to the findings from a study conducted by the National Energy Regulator of South Africa (Nersa) into the impact of the implementation of IBTs on residential customers.

The implementation of IBTs was approved by Nersa on the 24th of February 2010. The objective was to cushion the effect of rising electricity prices for low income residential customers in accordance with the country’s electricity pricing policy. The study, commissioned on the 12th of October 2011, looked at the impact of IBTs on different customer groups.

Electricity distributors that implemented IBTs were requested to submit their domestic customers’ bills to Nersa to enable the regulator to determine whether customers are benefiting from the implementation of IBTs. The findings indicated that customers consuming between 0 kWh and 400 kWh and some customers who consume between 401 kWh and 800 kWh have realised a decrease in their electricity bills, but others have experienced a slight increase.

Customers consuming above 1,000 kWh experienced an increase in their bills. Inclining Block Tariffs have been fully implemented by Eskom for both its conventional and prepaid meter customers. Seventy-six out of 173 municipalities have fully implemented IBTs for both conventional and prepaid customers. Nersa is assisting the remaining municipalities in effectively implementing IBTs.