Why Eskom’s “solar tax” and tariff blunders are punishing households

As a result, tariffs will rise 8.76% on 1 April 2026, up from 5.36% announced earlier this year, and tariffs for 2027/28 will rise 8.83%, up from 6.19%.

These unexpected increases add financial pressure to households and businesses already facing rising costs and an unpredictable electricity supply. Many households that had hoped to mitigate costs through energy-saving measures or investments in rooftop solar are now confronted with higher bills, making long-term planning and budgeting even more challenging.

The settlement has sparked general concern in the broader energy sector. Industry stakeholders note that these adjustments undermine consumer confidence and create uncertainty for companies and households trying to invest in energy efficiency or renewable energy solutions. The lack of a clear, transparent process has also raised questions about regulatory oversight and the predictability of future electricity pricing.

NERSA has been summoned to Parliament’s Portfolio Committee on Electricity and Energy to provide clarity on the settlement and explain its impact on future tariff determinations. In parallel, discussions are ongoing among various organisations and industry groups regarding legal and regulatory remedies, as many argue that consumers should not bear the financial consequences of calculation errors.

Beyond the immediate tariff increases, households may also face higher electricity bills in the longer term if further adjustments or clawbacks are implemented. This creates uncertainty for families already balancing essential expenses, including food, transport, and housing. For households considering rooftop solar, these developments complicate investment decisions and make the promise of energy independence more difficult to achieve.

Why Eskom’s “solar tax” is backfiring

South Africans have been rushing to rooftop solar in record numbers, not just to avoid load shedding, but to break free from the relentless cycle of electricity tariff hikes. In the face of an uncertain electricity supply, solar provides energy independence, long-term savings, and the ability to take back control of your own power.

But households attempting the switch face a maze of obstacles in the form of excessive registration fees, unclear regulations, and now, new tariffs. Eskom and government continue to move the goalposts. Instead of building confidence and enabling wider adoption, current policies risk slowing progress at the very moment the country needs it to accelerate.

The registration trap

All grid-tied solar systems under 100kVA, which is the standard for home installations, must be registered with Eskom. On paper, the requirement is meant to ensure safety and prevent unsafe backfeeding into the grid. In practice, it creates a financial burden.

Homeowners must obtain a professional engineer’s sign-off, which can cost up to R20,000. By comparison, a Certificate of Compliance issued by a registered electrician costs about R1,500 and is already recognised across the industry as proof of electrical safety.

For many households, R20,000 represents the cost of an extra panel, a battery upgrade, or bond repayments. When compliance is priced this high, what should be a reasonable safeguard becomes an insurmountable barrier, making solar feel like a privilege for wealthier households.

The South African Bureau of Standards (SABS) is finalising new regulations that would allow qualified electricians, not only engineers, to certify systems. This reform would significantly reduce compliance costs and accelerate solar adoption, opening the door for many more households to invest in solar energy with confidence.

The tariff sting

Even if registration becomes more affordable, tariffs remain a critical issue. Many solar households have been placed on Eskom’s Homeflex tariff, which includes mandatory smart meters and sharply higher fixed connection fees. This extra charge penalises households for choosing solar, making it harder to achieve financial relief through reduced grid consumption.

By raising fixed costs, the tariff structure risks driving more households to disconnect from the grid entirely. Every household that leaves reduces the customer base, leaving fewer people to carry Eskom’s overheads. This cycle can destabilise the system, erode trust in the energy sector, and make the cost of electricity less predictable for all consumers.

For families investing in solar, this uncertainty increases the financial risk associated with installing a system. The combination of higher upfront compliance costs and higher ongoing tariffs may discourage households from pursuing energy independence, slowing progress in the transition to cleaner, more sustainable energy sources.

The way forward

Clarity from NERSA and finalisation of the SABS review are essential for consumers and the industry. Empowering licensed electricians to certify solar systems would dramatically reduce compliance costs. Additionally, transparent guidance on tariff structures and Eskom’s authority would provide certainty for consumers and investors alike.

The stakes are high. For families, it can mean thousands of rand saved or lost each year. For the industry, it could determine whether solar adoption accelerates or stalls.

South Africans deserve a framework that keeps compliance costs reasonable, ensures tariffs reflect actual grid use rather than blanket penalties, and rebuilds trust in the energy transition.

Alumo Energy’s position

At Alumo Energy, we believe solar should be affordable, accessible, and empowering. Our role is not just to install systems, but to guide South Africans through the maze of compliance, tariffs, and regulation.

We see households struggling with uncertainty every day. Families ask whether they should register now or wait. Others worry that tariffs have already made their investment less viable. These are critical questions that determine whether solar is viewed as a safe long-term investment or as a gamble.

We continue to advocate for clarity and fairness in regulation. Solar should cut costs, not add hidden ones. It should strengthen the grid and restore trust in the energy transition, not erode it.

This is the crossroads. Relief is possible, but only if policies prioritise households over bureaucracy and progress over protectionism. The choice is here, and the country cannot afford another wrong turn. DM