Is electricity cheaper on the 1st of month?
No, dummy (A little public service announcement because I have been overpaying for years ...)
Whether it be because I am getting wiser or less tolerant of being ripped off, I finally read about how to get more bang for my buck when buying prepaid electricity. We have solar at home, thanks to the amazing rental deal from GoSolr:
Renting our own little piece of the sun
This is an old post from www.CallOffTheSearch.com, June 2023, a year and a half in with GoSolr and we are still delighted with our choice: I have been sitting on this news for a few weeks now because I was worried that if it seemed too good to be true, it probably was. But now that our (rented) solar panels, inverter and battery are fully fitted and ope…
… but we must still buy a little electricity from Eskom. I have been buying R1000’s worth every few months, which I now realise is foolish. Every month, electricity consumers get some units at a reduced rate. As they buy/use more the price of each unit increases. This is designed to encourage people to use electricity sparingly. If you don’t buy those cheap units in any given month, you lose them so buying ‘bulk’ every few months means we miss out on most of our cheap units.
The amount of money I will save by spending a few hundred rand every month rather than R1k every few months may not seem worth the trouble but I am a person who switches the geyser on and off every day to save electricity so … you know … happy to schlepp a bit to spend as little as I can with Eskom.
Besides, look at where electricity prices are going: “Eskom has requested a 36.15% electricity tariff increase for 2025/26, bringing its Block 1 and 2 Homepower 4 tariffs to R3.84 and R6.18 per kWh, respectively. Ten years ago, these tariffs were R1.14 and R1.83 per kWh. If Eskom’s electricity tariff increase for 2025/26 is approved, this would represent an increase of approximately 237% over ten years.” - Electricity price nightmare in South Africa
It might be worth the schlepp for you to read this article, too: Electricity Block/Step Tariffs Explained
It was Myth 3: “It’s cheaper to buy in bulk, for multiple months in advance” that got me: Prepaid24 says: This is a misconception that comes from our idea that buying in bulk is cheaper. This is not the case with prepaid electricity.
In fact, buying electricity in bulk can cause you to lose out on a lot of value. Here’s how:
By skipping months with your electricity purchases, you are missing out on the cheap Block 1 units that are available to you every month. Unpurchased Block 1 units do not carry over to the next month. Thus, if you want to make sure you extract as much value out of your electricity purchases as possible, make sure that you at least buy your Block 1 units every month.
By buying several months’ units in advance, you will be purchasing the large majority of those units in the top block of your municipality’s tariff structure, where units are the most expensive. You will be treated like a massive electricity consumer, meaning you will overpay.
Buying electricity in bulk for months in advance to cover normal consumption means you miss out on your cheap Block 1 units in many months and will also cause you to overpay for the majority of the units you buy.
Example: Sandy lives in Johannesburg. She used to buy R6000 worth of electricity for her household once every 3 months, because it saved her time and she thought it would work out the same as buying smaller amounts every month.
After speaking to a Prepaid24 consultant, she discovered that buying bulk actually ends up being more expensive. She decided to buy R2000 every month for 3 months to test if she got more units. Here’s a breakdown of her purchases:
Sandy got 201.29 more units when she bought electricity every month instead of making bulk purchases in advance.