City Power is set to implement a residential time-of-use tariff system that will allow the utility to price electricity at different rates during the day.

This is aimed at encouraging consumption during off peak hours to reduce the cost to supply and lessen the pressure on the national grid.

The system, which has been approved by the National Electricity Regulator of South Africa (NERSA), will now also be available to residential users effective from 1 July.

City Power Managing Director Sicelo Xulu said the introduction of the time-of-use tariff is indicative of City Power’s commitment to help augment the security of supply and provide a means by which much-needed savings to consumers can be realised.

“City Power’s introduction of a time-based tariff system is informed by its commitment to provide services to its hard-pressed consumers by incentivising and rewarding them for changing their usage patterns, while at the same time ensuring security of supply by lessening the pressure on the grid.

“Load shedding is a fact of life that we have to contend with for the foreseeable future and we need to explore any conceivable solutions to ensure that we keep the lights on,” he said.

Xulu said the time-of-use tariff system is designed to help the customers to reap noticeable savings, provided they amend their usage patterns.

He said the spike during peak times is largely caused by hot water consumption and cooking by residential customers between 5:30pm and 8:30pm.

“These evening demand peaks are very expensive for City Power to deal with and are often the cause of overloads and outages

“The high cost of servicing the demand for power during peak periods is ultimately passed on to the consumer, so any reduction during the peak period from 5pm to 9pm typically is of mutual benefit to the consumer, City Power and Eskom generation,” he concluded.