Lower Eskom Tariffs, Fuel Price Trends & BRICS Mining Opportunities Unlocked

Welcome to the 31st edition of Financial Planning Made Simple. In this issue, we’ll break down Eskom’s revised tariff increases, the outlook for South Africa’s fuel prices, and the potential for BRICS mining partnerships to drive growth in the South African economy. Let’s dive in:

1. Eskom’s Tariff Adjustments: What You Need to Know

Nersa has approved lower-than-expected tariff increases for Eskom:

• 12.7% for the first financial year
• 5.36% for the second year
• 6.19% for the third year

This is a significant reduction from Eskom’s original proposal of over 36% for the first year. However, these cuts may have implications:

• Debt Coverage Challenges: Eskom’s reduced return on assets may impact its ability to service debt.
• Loadshedding Risks: Cuts in operating costs could mean less funding for diesel, potentially leading to more frequent power outages.

As Nersa’s reasoning for these adjustments is not yet fully disclosed, uncertainty remains over Eskom’s future pricing strategies.

Financial Planning Insight: Businesses and households should prepare for possible electricity price hikes or increased loadshedding, especially during winter months.

2. March 2025 Fuel Price Outlook: Volatility on the Horizon

According to mid-month data from the Central Energy Fund, here’s the expected outlook:

• 95 Unleaded Petrol: Up by 13 cents per litre
• 93 Unleaded Petrol: Up by 25 cents per litre
• 500ppm Diesel: Up by 7 cents per litre
• 50ppm Diesel: No change

Global factors are adding volatility to oil prices, including:

• Supply Chain Easing: Possible peace talks between Russia and Ukraine could stabilize supply lines.
• US Oil Stockpiles: Higher US inventories are putting downward pressure on prices.

South Africans may see smaller fuel price hikes—or even slight decreases—if international oil prices decline further by month-end.

Key Tip: Consider adjusting transport budgets as fuel prices remain unpredictable.

3. Unlocking BRICS Mining Opportunities for South Africa

South Africa’s membership in BRICS offers major opportunities to develop its mining sector, particularly with its abundant reserves of gold, platinum, and rare earth metals.

Strategic Benefits of BRICS Partnerships:

• Increased Capital: Foreign investment could help modernize South Africa’s mining industry.
• Technology Sharing: Access to advanced mining technologies could enhance efficiency and sustainability.
• Export Expansion: South Africa can access expanded markets within BRICS countries for its mineral products.

Key Initiatives to Watch:

• Investment in Skills: Focused training programmes could boost safety and productivity in the mining sector.
• Regulatory Collaboration: South Africa could lead efforts to standardize mining safety and environmental practices across BRICS nations.

Final Thoughts

The South African economy faces both challenges and opportunities in 2025. By staying informed on tariff changes, fuel price trends, and global partnerships, you can make smarter financial decisions for long-term wealth protection.

For tailored wealth planning strategies, reach out today to explore opportunities that fit your goals.