- Eskom says it will not fine direct customers for unregistered residential solar systems for now.
- Industry groups warn regulatory uncertainty is delaying projects and discouraging investment.
Eskom has confirmed that it will not impose fines on its direct customers who have failed to register residential solar power systems under its small scale embedded generation programme, at least for the time being.
The clarification follows criticism from the Organisation Undoing Tax Abuse which has challenged recent warnings from Eskom and several municipalities that households could face penalties or disconnection for failing to register solar installations.
Speaking in an interview on The Money Show with Stephen Grootes, Eskom Distribution general manager for the central and east cluster Kevin Pillay said unregistered systems were not currently being treated as illegal connections.
Eskom has the legal power to impose fines for illegal connections, Pillay said, but added that the utility was not deeming unregistered solar systems to be illegal at this stage. Instead, Eskom was encouraging customers to come forward voluntarily, particularly while a cost concession remained in place.
Eskom is currently waiving registration fees for small scale embedded generation systems, including the cost of a bidirectional smart meter and safety verification requirements. This concession runs until 31 March 2026.
The interview also addressed concerns around Eskom’s requirement that all grid tied or hybrid self-generation systems be moved onto its Homeflex time of use tariff. This tariff (service charge) applies different rates depending on peak, standard and off peak consumption periods.
Pillay explained that prepaid tariff structures do not allow Eskom to implement the fixed and time based pricing model required for customers with self-generation. He stressed that the tariff change was not intended to punish solar users but to account for differences in grid usage.
According to Pillay, customers with solar systems may rely on the grid for only a small portion of their energy needs but still require the infrastructure to be available at all times. This, he said, creates an imbalance in cost recovery when compared to customers who rely entirely on the grid.
OUTA has challenged this position, arguing that consumers should have the flexibility to choose tariff structures that best suit their circumstances. The organisation says frequent changes to registration requirements and deadlines have created confusion and anxiety among homeowners and industry stakeholders.
The uncertainty is already affecting the residential solar market. OUTA reports a rise in public queries following communications from Eskom and municipalities such as the City of Johannesburg, which require registration or prior approval for solar installations below 100 kilowatts, even where no electricity is exported to the grid.
OUTA chief executive Wayne Duvenage said the situation undermines the rights of consumers who invested in alternative energy solutions in response to government calls to reduce electricity demand.
Many households installed solar systems, inverters, generators and gas appliances at significant personal cost to protect themselves from rising tariffs and unreliable supply, Duvenage said. He added that threats of penalties now risk punishing responsible behaviour.
The regulatory uncertainty is also rippling through the solar value chain. Some financiers, insurers and installers are reportedly delaying or declining residential projects due to unclear compliance requirements.
OUTA has urged financial institutions and insurers not to refuse funding or cover based on what it describes as shifting and poorly defined demands from authorities. The organisation argues that such decisions could unfairly penalise compliant consumers and slow growth in distributed generation at a time when it is needed to support the national grid.
Homeowners are encouraged to ensure that installations meet national safety standards and are backed by a valid certificate of compliance issued by a registered electrician. Under the Occupational Health and Safety Act, Electrical Installation Regulations and SANS 10142 1, residential solar systems must be certified before commissioning.
Duvenage compared the current situation to the administrative challenges experienced during the electronic tolling rollout, warning that enforcement driven by threats and complex regulation often fails without public acceptance and practical implementation.
While critical of recent communications, OUTA noted that Eskom appears to have softened its stance on fines and disconnections, suggesting a growing acknowledgement of the legal and practical constraints involved.
Author: Bryan Groenendaal
