THORNHILL LIFE
Pre-paid power problems
I have noted from an exchange of postings on the Thornhill spot mar-
ket WhatsApp group, that there is a lot of confusion over the tariffs for
pre-paid electricity. First it is important to recognize that the rate you
pay is related to how much you purchase in a particular month, and
not how much you consume.
Whilst this might sound obvious, it can have a substantially negative
impact on your bill if you buy more than you need in a particular
month.
The reason is that the tariffs are constructed in blocks. The first block
is for amounts purchased from zero to 500 kWh. This comes at the
lowest price per kWh. The second block runs from 501 to 1000 kWh
which comes at a higher rate. 1001 to 2000 kWh comes even higher,
and so on. There are 5 blocks per the following table for 2018/19.
Block
Amount
(kWh)
Cost
(c/kWh)
Surcharge
(c/kWh)
VAT
(c/kWh)
Out of pocket
(c/kWh)
1 0-500 124.49 0 18.67 143.16
2 501-1000 141.43 6.00 22.11 169.54
3 1001-2000 151.86 6.00 23.68 181.54
4 2001-3000 171.55 6.00 26.63 204.18
5 >3000 185.91 6.00 28.79 220.70
As an example, if you spend R2 000 in a particular month, you will get:
• 500 kWh at 143.16 c/kWh costing R715.80 plus
• 500 kWh at 169.54 c/kWh costing R847.70 plus
• 240.44 kWh at 181.54 c/kWh costing R436.50
Total: 1 240.44 kWh at 161.23 c/kWh costing R2 000
If you are consuming 500 kWh or less each month, and you buy 500
kWh only each month, the price per kWh would remain at the lower
block level of 143.16 c/kWh. By making a single R2 000 purchase you
end up paying an average of 163.16 c/kWh, a 13% increase on what
you actually need to pay.
Continued...