Eskom “triple tax” pain in South Africa
Eskom’s financial challenges cost South African residents numerous times through taxpayer-funded bailouts, rising electricity prices, and new fixed fees, placing more strain on the country’s households.
The National Assembly recently debated the Eskom Debt Relief Bill, and one major criticism of the power utility is this “triple tax” straining South African households.
Rise Mzansi caucus whip Makashule Gana explained that working South African families struggle to pay for electricity and essentials due to Eskom’s high prices.
“This debate on the Eskom Debt Relief Amendment Bill isn’t just about the billion and budget… it’s about a grandmother who now chooses between buying electricity and buying bread,” he said.
“It is about each South African who uses their prepaid meter, punches in a voucher, and gets fewer and fewer units every passing month.”
The Eskom Debt Relief Amendment Bill proposes striking R20 billion off the power utility’s original debt relief plan.
The National Treasury introduced the Eskom Debt Relief Act in 2023 and allocated R254 billion to the state-owned power utility. This included a R70-billion debt takeover in the current financial year.
The amendment bill, introduced with the 2025 Budget, replaces the R70-billion debt takeover with two direct advances to Eskom totalling R50 billion.
“On paper, that sounds like progress,” said Gana.
“Let’s be honest with the people. Year after year, Eskom receives bailouts, guarantees, and relief. What do the people of South Africa get in return? Less electricity and higher prices.”
He said Eskom must use the bailouts to deal with high electricity prices and load reduction, which puts immense pressure on businesses in communities where Eskom implements the mechanism.
“The painful truth is this: Eskom has been given billions to provide reliable and affordable electricity, but South Africans now are paying twice,” said Gana.
“First, through the taxes to fund Eskom and again, through the soaring electricity prices that are now becoming affordable for working families.”
The power utility applied for a substantial tariff hike, averaging 36.15% for direct customers in 2025. However, South Africa’s energy regulator cut the increase to 12.7%, which took effect on 1 April.
The power utility applied for a substantial tariff hike, averaging 36.15% for direct customers in 2025. However, South Africa’s energy regulator cut the increase to 12.7%, which took effect on 1 April.
However, Gana said enabling the electricity price increases amounts to at least a double payment to Eskom, as taxes have been used to bail it out, and it is now clawing in more money through price hikes.
A third tax on South Africans
South African households that receive their electricity directly from Eskom are subject to a “third tax” that Gana does not directly address.
Eskom implemented restructured tariffs through its Retail Tariff Plan in April 2025, introducing various new service, network, and capacity charges on regular bills.
These fixed charges apply whether a household consumes electricity or not. A MyBroadband analysis of the fixed fees revealed that the changes ultimately punish people who use less grid power.
The most significant change was introducing higher fixed charges independent of consumption, such as a fixed Generation Capacity Charge (GCC) levied per day, and per Eskom point of delivery (POD).
This directly punishes solar power users who only require grid power during times of low solar generation capacity, and poorer households that consume less grid power on average.
Due to these new fixed charges and the electricity tariff hikes, Eskom customers have reported seeing their electricity bills surge by between 30% and 80% a month.
Municipalities have implemented fixed charges on prepaid electricity recharges to access additional funds.
Two examples are the Cities of Johannesburg and Ekurhuleni, which have applied new fixed capacity charges to prepaid households regardless of how much electricity they consume.
Unrest broke out in Tembisa when Ekurhuleni implemented the change, causing the metro to suspend the new R126 fixed electricity tariff temporarily.
Gana said these trends are unsustainable and are pushing poorer communities to their limit, adding that the poor shouldn’t be punished for the failures of the powerful.
“We must start talking about electricity price relief, not for Eskom, but for the people of South Africa,” he said.