SA Water Tariffs vs. Eskom: The Hidden Crisis in Your Bill

A Tale Of Two Tragedies – South Africa Battling With Its Supply Of Electricity And Water

We don’t have to merely accept the situation!

The beleaguered South African consumer is being hit again with a predicted 41 cent per litre increase in the petrol price in December 2022. Inflation, as at October 2022 was at a quoted “7.6%” (www.statssa.gov.za) this is 1.5% above the SA Reserve Bank target range of 3 – 6% and an increase of 3% over the 2021 figure of 4.6%.

It appears that the average South African’s wallet needs to stretch further and further. Luxuries will therefore have to be cut to enable our families to survive. Certain increases are unfortunately beyond even our government’s control, such as overseas conflicts and sovereign countries policies that affect energy prices. Of course this would logically affect the price of almost all consumables as they have to be transported to the place of sale and transport costs are therefore built into the end sale price

However there are two products which are essential to all our modern lifestyles which are also “leading” in the inflation race, one which is always in the firing line and that of course is the electrical supply from Eskom. Yet one essential that tends to fall below the radar is the municipal water supply, probably the most essential resource of all for mankind – drinkable water.

So let’s look at both

Eskom, South Africa’s electricity provider is plagued by ageing infrastructure, debt, corruption and mismanagement resulting in a situation where it is unable to effectively supply the needs of the nation. This has resulted in unprecedented load-shedding and tariff increases, but unfortunately not enhanced service delivery. Since 2007 to 2020 electricity tariffs have increased by 512% while the increase in inflation was only 106% (still a staggering value)

Eskom tarrif vs inflation comparison with projections 2022

Now let’s explore the water tariffs from the local municipalities, much harder to highlight as they form only a segment of the total monthly municipal account and costed on consumption block tariff at different pricing rates. With an ever increasing consumer base and therefore funding base you would expect any increases to be in line with inflation – you would think that the provision of potable water should not be a cash cow for the local councils, yet from 1996 to 2021, the average water and sanitation tariff has increased by a staggering 1270%, almost 4 times that of the inflation rate of 296%!

average municipal water and sanitary tarrifs graph

With the bulk of the nation’s frustration directed at Eskom, the magnitude of the tariff increases by the local municipalities have mostly gone unseen.

“But hasn’t the value of the Rand decreased over the years”– certainly inflation can distort percentage figures – so borrowed again from the publication “The price of water & electricity in South Africa” by M Capes & S Moolman – the 1996 prices have been adjusted by the applicable yearly inflation rates to a 2020 value to show above inflation tariff increases

south african monthly electricity and water bills graph

The above graph demonstrates that in today’s money, the utilities bill for water (and sewerage which is calculated on water consumption) and electricity has increased from R638.00 (R383 plus 255 in 1996) to a staggering R2028.00 (1178 plus 850 in 2020) an almost 200% increase in “REAL MONEY” terms.

It is vitally important that the man in the street is made aware of what is happening and where their hard earned money is going. Calculated again in an above inflation real money calculation, the average household disposable income has only increased by 37%, so where has the money gone?

Has the countrywide municipal infrastructure been enhanced?

Has service delivery improved?

Are we getting what we paid for?

The Municipalities are now regulating electricity gathering via solar and wind collection will the man on the street, if investing in this be taxed at a later date – not certain at this point and already an end user sourcing underground water from underground sources has to be registered and the council are considering metering (possibly charging at a later date) all water excised from the aquifers beneath the Cape Flats, Table Mountain and TMG aquifers to ensure that the resource is not over exploited and eventually exhausted ( it can take many years, in some cases hundreds or thousands of years for surface water to drain through the various rock strata’s until it reaches the underground lakes)

We must learn that we have to take control and ensure that our own premises are energy and water efficient, both electricity and water saving fittings have been employed, and that wastage is cut to an absolute minimum

Especially with drinkable water, a finite resource with only 0.5% of the earths water that can be utilised without processing for human consumption, which is decreasing daily due to increased demand, pollution, be it via human carelessness, agricultural , industrial or chemical.

Some sobering thoughts for everyone to digest is that:-

In South Africa 36.8% of all the drinkable water that leaves the municipal water treatment works never reaches its customers due to leaks in the municipal supply mains. – Water research Commission (WRC)
In “first world” America household leaks after the meter can account for nearly 38000 ltrs per annum and in almost 10% of household there are unfixed leaks that waste up to 340 ltrs or more per day
That a dripping tap can waste up to 1ltr per hour and a running WC can waste up to 7.5 ltrs per hour

It is up to us all to ensure that our children and grandchildren will be able to have free access to these resources that we take so for granted