Solar vs. Eskom: A cost comparison
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The escalating cost of electricity in South Africa has become a significant concern for businesses, impacting their bottom lines and overall operations. As businesses seek ways to mitigate these rising expenses, many are turning to alternative energy sources, such as solar power.
Understanding the cost of electricity
Eskom has been grappling with various challenges, including ageing infrastructure, financial constraints, debt financing obligations and decreasing demand. These factors have left Eskom with no option but to sharply increase its cost of electricity over the next 3 years.
Unlike Eskom, the solar industry is benefiting from rapidly declining costs of solar components and accessible long-term financing, allowing businesses to enjoy significantly lower electricity rates compared to what they currently pay to Eskom.
Current tariff comparison: Solar vs. Eskom
The cost savings offered by the solar market compared to Eskom are substantial, particularly given Eskom's escalating tariffs. The following table highlights the difference between Eskom's high season tariffs and the rates offered by Jaltech where a solar system without batteries is installed (note that these rates don't take into account Eskom's fixed cost component):
Future tariff comparisons
If Eskom is granted the 38% tariff increase it has applied for with NERSA, while solar rates only increase by 7%, the cost savings for solar users will be substantial. The difference in escalation rates makes solar an even more attractive option, offering businesses the potential for significant long-term financial benefits.
Conclusion
As businesses grapple with rising electricity costs in South Africa, solar power presents a viable and cost-effective alternative. While Eskom faces the challenges of ageing infrastructure, financial strain, and rising tariffs, the solar industry offers businesses a significantly more affordable energy solution. With savings ranging from 32% to 41% compared to Eskom's current tariffs and potential future savings reaching as high as 54%, the financial advantages of switching to solar are clear.
To join the over 180 businesses partnered with Jaltech, click here to find out more about Jaltech's solar funding solution.
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