South Africa’s electricity prices have risen by over 600% since 2008

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According to Momentum Investments, electricity prices surged by over 600% between January 2008 and early 2025, compared to just 139% growth in headline inflation over the same period.

South Africa’s electricity prices have skyrocketed by more than 600% since 2008, far outpacing headline inflation and becoming a key structural driver of rising costs across the economy. This relentless rise in energy costs continues to complicate efforts by the South African Reserve Bank (SARB) to ease interest rates despite recent dips in overall inflation.

Electricity tariffs, which are part of administered prices – including municipal charges and water tariffs – have consistently outstripped broader inflation for the past 16 years. According to Momentum Investments, electricity prices surged by over 600% between January 2008 and early 2025, compared to just 139% growth in headline inflation over the same period.

While inflation cooled notably through 2024, falling below 3% in October and November as food and fuel prices eased, a rebound began in 2025. In February, inflation rose slightly to 3.2%, driven by rising fuel and food costs. The Reserve Bank noted that falling fuel prices in late 2024 had a dampening effect on inflation, even pulling administered price growth into negative territory by October.

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However, administered price inflation surged again to 4.2% in February 2025, as the impact of declining fuel prices faded. When fuel is excluded, these inflationary pressures remain stark, with administered price inflation at 7.7%, well above the SARB’s inflation target midpoint of 4.5% and the overall February rate of 3.2%.