Impact SA

City’s plan to cut Eskom reliance could raise costs elsewhere

2 sept eskom shift isa

A major South African city’s move to reduce dependence on Eskom promises local benefits such as cheaper, more reliable electricity. But the shift could have unintended consequences: as a large municipal customer exits, Eskom may need to recover lost revenue through higher prices for remaining users, pushing costs onto other households and businesses.

By Bianke Neethling – Daily Investor

The analysis also notes that, despite recent improvements, Eskom’s performance still lags pre-2019/2021 levels and the utility relied heavily on diesel-fired open-cycle gas turbines over winter. Any rapid erosion of municipal sales, without a broader pricing reform, risks shifting costs rather than lowering them overall.

The takeaway is clear: municipal energy diversification can help residents, but it needs national coordination on tariffs, grid access and financing so the gains don’t come at a wider cost.

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