South African farmers are all too familiar with the crunch of rising electricity costs. With Eskom’s annual increases pushing up energy bills — especially for those in rural areas — the traditional reliance on grid power is increasingly unsustainable. Off-grid agriculture systems are emerging as a viable, strategic path forward: reliable, cost-efficient, and aligned with a greener future.

The Growing Cost of Staying On-Grid

Since 1 April 2025, Eskom has enforced a 12.7% electricity tariff increase, with further hikes of 5.36% in 2026–2027 and 6.19% in 2027–2028 — totalling over 24% across three years.

For irrigation-dependent farmers, these hikes hit hard. As Francois Wilken, president of Free State Agriculture, puts it:

“Free State farmers… extremely disappointed… energy costs are already very high.”

Meanwhile, Eskom’s tariff restructuring now includes new fixed components like the Generation Capacity Charge and Legacy Charge, alongside significantly higher network (line) charges — including up to a 43% increase in fixed network capacity costs.

Rural users on tariffs such as Ruraflex face heavy surcharges, and the “unintentional subsidy” structure means that customers relying minimally on Eskom (as back-up only) pay proportionally more.

Line Fees: A Persistent Drain on Rural Farming

Beyond escalating tariffs, the line fees — costs associated with connecting or relocating supply lines — also weigh heavily on farmers.

• Rural customers are typically charged actual cost for line relocation or infrastructure changes, which can be prohibitively expensive.
• Even overhead line shifts come with sizeable fees, unless a customer qualifies under the rare “bona fide farming” allowance.
  

These structural costs, combined with tariff adversity, make Eskom’s grid increasingly unappealing — particularly during seasonal demand peaks.

The Case for Off-Grid Agriculture Systems

Here’s why off-grid solutions make sense — now more than ever:

Avoiding Escalating Electricity Rates

By harnessing solar PV, batteries, or gas-powered systems, farmers sidestep Eskom’s unpredictable rate increases and avoid legacy/capacity charges. This enables a more predictable energy cost structure.

Mitigating Peak Tariff Pressures

Grid tariffs surge during peak hours, especially winter mornings and evenings. For citrus farmers under Ruraflex, peak rates can exceed R7/kWh — more than triple standard rates. Off-grid systems allow farmers to meet these demands with stored or locally generated power.

Greater Control, Tailored Solutions

Off-grid systems — from solar-battery hybrids to generator-backed setups — can be scaled to align with production cycles. Batteries may be capital-intensive, but combining them with solar or gas improves long-term efficiency.

Benefiting from Government Incentives

‍South Africa’s solar incentives, such as accelerated depreciation (Section 12B), allow:

1. Commercial installations ≤ 1 MWₚ to be written off in one year (28% tax shield).
2. Larger systems follow a 50/30/20% schedule over three years.
3. This strengthens the financial case for off-grid adoption.
4. A Growing Market Transition
5. Industry voices note that tariff structuring is making it cost-effective to leave the grid entirely. Meanwhile, the launch of the South African Wholesale Electricity Market (SAWEM) may transform energy provisioning — though grid structures remain rigid for now.

What Can Farmers Do Today?

• Start with an energy audit — identify demand peaks (irrigation, cold storage, processing).
• Design hybrid systems — combine solar generation, battery storage, and/or efficient gas backup.
• Deploy in phases — start small, then scale with budgets and operations.
• Use tax incentives like Section 12B to accelerate ROI.
• Lobby for fairer grid integration — current tariffs discourage feeding back into the grid; pushing for prosumer-friendly policies is key.

Final Thought

The writing is on the wall: Eskom’s relentless tariff hikes and asset-based charges are reshaping the agricultural energy landscape.

Off-grid agriculture systems aren’t just a viable option — they’re fast becoming the strategic future of energy autonomy for South African farmers.

With cost control, reliability, and sustainability in play, now is the moment to pivot away from a grid that’s grown too expensive and rigid.