This Farm Will Cut Its Electricity Cost
by 31% From Day One
A 250 kWp hybrid solar and battery storage system will deliver power at 173.7c/kWh — while Eskom charges 252c/kWh and climbing. The system was cash-positive from the very first month.
An electricity bill that grows faster than the operation
A commercial dairy operation in the KwaZulu-Natal Midlands was spending over R1.8 million per year on electricity. With NERSA confirming above-inflation increases locked in through 2028, the operation faced a structurally rising cost that no efficiency measure could offset.
This analysis is based on actual site load data, confirmed equipment pricing, and NERSA-approved tariff schedules. Installation pending.
R1,841,794 saved in Year 1
The savings do not depend on a single assumption. If any one stream underperforms, the other three remain intact.
Energy generated on-site offsets grid purchases at the blended energy rate. The 250 kWp array generates 400,043 kWh in Year 1.
Battery discharges during expensive peak windows (06:00–09:00 & 17:00–19:00), avoiding premium time-of-use tariffs.
Battery caps peak kVA demand, reducing the monthly notified maximum demand charge by 200 kVA. This saving alone nearly covers the loan.
Five legacy transformer PODs consolidated into one supply. Monthly fixed charges on five accounts permanently eliminated.
Demand shaving + fixed charge savings = R882,507/year
Entirely independent of the energy tariff. They persist regardless of what Eskom's c/kWh rate does.
Cheaper than Eskom from Day 1
The fully-loaded LCOE includes every rand over 25 years: all capital, all loan interest at 10.25%, and all operations & maintenance. Nothing excluded. Yet it's already cheaper.
For Eskom to undercut this system's cost, tariffs would need to fall by 31% in real terms and hold there for 25 years. That has never happened in Eskom's history. Not once.
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Positive from Month 1. Growing every year.
Monthly savings of R153,483 against a fixed loan repayment of R150,576. Because the repayment is fixed while Eskom compounds upward, the net saving grows automatically every year.
| Year | Eskom Rate | Annual Savings | Loan Cost | Net Benefit | Cumulative |
|---|---|---|---|---|---|
| 1 | 252c | R1,841,794 | R1,806,909 | R34,884 | R34,884 |
| 2 | 272c | R1,989,137 | R1,806,909 | R182,228 | R217,112 |
| 3 | 294c | R2,148,268 | R1,806,909 | R341,359 | R558,470 |
| 5 | 343c | R2,505,740 | R1,806,909 | R698,830 | R1,770,520 |
| 7 | 400c | R2,922,695 | R1,806,909 | R1,115,785 | R3,785,595 |
| 8LOAN REPAID | 432c | R3,156,511 | Loan repaid | R3,156,511 | R6,942,106 |
| 10 | 504c | R3,681,754 | — | R3,681,754 | R14,032,891 |
| 15 | 740c | R5,409,704 | — | R5,409,704 | R37,360,223 |
| 20 | 1,088c | R7,948,631 | — | R7,948,631 | R71,635,726 |
The direction of travel is confirmed — and it is upward
These are regulatory determinations, not projections. NERSA has locked in above-inflation Eskom tariff increases through 2028. The national average tariff has increased 190% in the decade to 2024, compounding at roughly 11% per year against CPI of around 5%.
Why tariffs will keep rising
South Africa's IRP 2025 and analysis from the CSIR, DBSA, and IEA all point in the same direction:
The question is not whether tariffs will rise. They will.
The question is whether to keep paying for it — or to lock in a known, stable cost now.
Get Your Farm's NumbersWhat Could Your Farm Save?
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