Rural settlements and farms would pay 4 percent more on average over and above Eskom's annual tariff increases for 2004, the national electricity utility said yesterday.
"We have to charge the smaller consumers that extra because they are being subsidised to the tune of R2.1 billion a year by our large industrial and municipal customers," said Deon Conradie, Eskom's senior manager for electricity pricing.
"On average this will be less than a 1 percent reduction on the electricity bill for the larger consumers and will not apply to residential customers, who will only see the annual increase."
Conradie said distributing electricity to rural areas was more expensive because there were more networks and fewer customers there than in urban areas.
He said Eskom had applied to the National Electricity Regulator (NER) for an annual increase for 2004 higher than the average CPIX - consumer price inflation less mortgage costs.
Eskom will introduce retail tariff changes in the new year in accordance with recommendations in the white paper on energy.
These will include the introduction of cents-per-kilowatt network charges on the utility's nightsave (urban and rural), miniflex and megaflex tariff regimes.
Conradie said the megaflex tariff regime referred to energy consumption and network charges for large industrial and municipal consumers, differentiated by the time of the day and season.
The miniflex charges used the same parameters for charging the smaller consumers, excluding network or energy transportation fees.
On Monday the NER will publish the processes and methodologies that were followed in evaluating Eskom's application for tariff increases.
Wolsey Barnard, the NER's executive manager for regulation, said the regulator's board would announce a final decision on Eskom's application next Thursday.
The regime for different tariffs for large industrial, municipal, rural areas and farms would continue after next Thursday.
"We are busy trying to normalise the cross-subsidisation situation between large and small consumers, but that will take years to complete," Barnard said.
