Democratic Alliance Proposes New Electricity Tariff Law
The draft bill seeks to introduce stricter oversight for electricity pricing and requires verified cost-of-supply studies.
Updated on Oct. 20, 2026 in Utilities
Live Poll
Should utility regulators be required to verify cost-of-supply studies before raising electricity prices?
The Democratic Alliance has released a draft bill to amend the Electricity Regulation Act in South Africa. The proposed legislation aims to close regulatory loopholes and protect consumers from unverified tariff increases.
Why it matters
The bill addresses significant regulatory errors, including a recent R54.7-billion correction regarding Eskom's revenue determination. It seeks to ensure that future tariff hikes are supported by demonstrable, independent cost-of-supply studies.
The National Energy Regulator of South Africa approved an 8.83% tariff hike for the 2027/28 financial year. This follows a R54.7-billion correction in Eskom's revenue determination.
The players
Democratic Alliance
This is a South African political party that currently serves as the official opposition and has initiated the proposed legislative amendments.
National Energy Regulator of South Africa
This regulatory body is responsible for regulating the electricity, piped-gas, and petroleum pipeline industries in South Africa.
Eskom
This is the state-owned utility company that generates and distributes the vast majority of electricity within South Africa.
The details
Under the proposed law, the National Energy Regulator of South Africa would be required to verify and publish cost-of-supply studies for all tariff applications. The bill further mandates judicial review for any amendments to approved tariffs and prohibits their retroactive application.
Timeline
The formal notice of the draft bill was published in the Government Gazette on 20 October 2026.
The public comment period for the legislation is open until 15 November 2026.
The approved 8.83% electricity tariff increase takes effect for the 2027/28 financial year.
Market Landscape
The proposed legislation marks a significant shift toward increased regulatory oversight in the energy sector, challenging the historical autonomy of utility revenue determinations. By mandating judicial and scientific scrutiny, it aligns with broader trends in South Africa to ensure greater public accountability from state-linked monopolies.
The proposed changes aim to shield households from unverified tariff hikes, potentially stabilizing electricity costs for consumers. However, until the bill is passed and enacted, current pricing structures for the 2027/28 financial year remain in place.
The takeaway
This legislation represents an effort to codify scientific justification into the electricity pricing process. Residents should track the parliamentary progress of the bill to understand how it may eventually influence future utility billing practices.
Further reading
For more information on the current regulatory environment, visit the Utilities section.
Live Poll
Should utility regulators be required to verify cost-of-supply studies before raising electricity prices?
