Durban solar feed-in charges hurt consumers

The eThekwini Municipality’s solar feed-in tariff looks good at first glance — it is the second-best in the country — but its monthly “ancillary network charge” makes it difficult for homeowners to break even.

A MyBroadband reader and Durban North resident with a residential solar installation said they would need to sell nearly 2,000kWh back to the city each month to break even.

As a result, they haven’t bothered with the process of registering as a feed-in customer.

The eThekwini Municipality, which encompasses Durban and surrounding regions, offers an energy buyback rate of R1.44 per kWh, including VAT.

It specifies that the buyback rate is time-dependent and based on the kilowatt-hours of electricity exported to the grid.

“The energy buyback will appear as a credit on the customer’s account. Credits are not eligible for cash payouts,” it notes in its tariff schedule for 2023/24.

It also charges an ancillary network charge based on inverter capacity, charged monthly at a rate of R126.86 per kVA capacity, including VAT.

In the case of the MyBroadband reader, their grid-tied solar system features 22kVA of inverter capacity.

At the rate of R126.86 per kVA, they would be charged R2,791 per month just to be eligible to sell electricity back to the city.

At the energy buyback rate of R1.44 per kWh, including VAT, they would have to sell roughly 1,940kWh back monthly to cover the ancillary network charge.

They noted that their system generates a surplus of roughly 500kWh per month in the summer months.

However, the reader said they sometimes rely on grid power in the colder months.

MyBroadband calculated the monthly payment for eThekwini customers with varying inverter capacities and the energy they’d have to sell back to break even.

Those with smaller 4.4kVA and 6kVA inverters would have to sell 388kWh and 529kWh back to the grid per month, just to cover their ancillary network charges.

Households with 10kVA of inverter capacity would need to sell nearly 900kWh back to the grid each month to break even.

However, it should be noted that the eThekwini Municipality’s tariff schedule is set to change soon, and we will likely see changes to these rates.

Its current tariff schedule was valid from 1 July 2023 to 30 June 2024.

The table below compares the eThekwini Municipality’s ancillary network charge costs and the required feed-in sales to break even for various smaller inverter capacities.

Bloemfontein residents get the best deal

Households in Bloemfontein can get the highest electricity credits for selling excess power to the grid compared to several other cities and large towns in South Africa.

MyBroadband compared solar feed-in tariffs of South Africa’s major metros in March 2024.

Of the three already offering these tariffs, we found that the City of Cape Town’s offering was the most attractive when weighing both tariffs and monthly fixed charges.

However, we carried out a more comprehensive analysis of feed-in tariffs across the country, including several more cities and large towns in the analysis.

The best rates were available from Bloemfontein’s power distributor Centlec, which offers customers a feed-in tariff of R1.62 in the summer (low-demand season) and R2.11 in the winter (high-demand season).

The peak time-of-use and standard winter feed-in rates of some municipalities and Eskom Direct were higher than Centlec’s winter and summer feed-in tariffs.

Its minimum feed-in tariff in the summer was around double the minimum offered by all the other municipalities’ off-peak rates and similar to standard winter tariffs.

Centlec doesn’t charge any additional fixed charges for net metering.

However, following our report, several Bloemfontein residents contacted MyBroadband to complain that they have been unable to make use of Centlec’s published feed-in tariffs.

Therefore, while Centlec’s rates may be the best on paper, they may not actually exist in practice.