FAQ: 7 - Why are business tariffs more expensive than the residential tariffs?

Some business tariffs actually work out less than the residential rates - depending on the tariff and usage pattern of the business. This is because cost is greatly influenced by WHEN electricity is used. For example, it is expensive to supply electricity at system peak times, and less costly to supply it during off-peak periods. 

Historically Durban’s residential customer used electricity outside the peak times. The business customer, on the other hand, uses electricity between 8am and 5pm and in the past coincided with the peak periods. This is the main reason why the business tariffs are set at a higher level than residential tariffs.

The situation has however begun to change, and Durban’s residential customers have started influencing WHEN the peak times occurs. For this reason residential rates have seen higher percentage increases than business tariffs over recent years.