South African Regulator Approves Higher Electricity Tariffs Following Correction of R54.7 Billion Accounting Error

Nersa confirms higher 2026/27 electricity tariffs of 8.76% for Eskom and 9.01% for municipalities to fix a R54.7 billion regulatory accounting error.

By: AXL Media

Published: Mar 10, 2026, 6:54 AM EDT

Source: The information in this article was sourced from Engineering News

Regulatory Correction Triggers Immediate Rise in Consumer Energy Costs

The National Energy Regulator of South Africa (Nersa) has officially revised its electricity tariff projections upward, confirming that Eskom’s direct customers will face an 8.76% hike starting April 1, 2026. This decision follows the approval of the Eskom Retail Tariffs and Structural Adjustment application by the Energy Regulator’s highest decision-making body. According to Nersa, the adjustment was necessitated by a significant R54.7-billion error previously made by the regulator when calculating Eskom’s regulatory asset base. This administrative oversight has effectively nullified the lower price path originally outlined in the sixth multiyear price determination, placing an unexpected financial burden on the national power grid's consumers.

High Court Mandate Forces Public Scrutiny of Recovery Plans

The move to increase tariffs comes after a period of intense legal and public scrutiny regarding how the multibillion-rand shortfall would be addressed. While Nersa initially sought a private settlement with Eskom last year, the High Court intervened in December, ordering the regulator to redetermine the recovery amount through a transparent public consultation process. Following this mandate, Nersa completed its redetermination in early February, concluding that the full R54.7-billion would be recovered over three financial years. This legal intervention was designed to ensure that the recovery process adhered to administrative fairness, though the ultimate result remains a higher price ceiling for industrial and domestic energy users.

Staggered Recovery Schedule for Eskom’s Regulatory Shortfall

To mitigate the immediate shock of the R54.7-billion recovery, the regulator has structured a staggered repayment plan that extends into the next decade. For the 2026/27 financial year, R12-billion will be recouped through the newly announced rates. A more substantial R23-billion is scheduled for recovery in 2027/28, while the remaining R19.7-billion balance will be incorporated into the subsequent multiyear price determination period. As a result of this phased approach, the tariff for direct Eskom customers in April 2027 will now rise by 8.83%, a significant jump from the 6.19% increase that had been previously forecasted before the accounting error was identified.