Danny Guselli talks energy-saving with Lindo Ngema
What is tariff optimisation, and why is it essential for businesses today?
As much as owning a business can be invigorating, specific challenges come with the territory. For instance, how often have you, as a business owner, complained about receiving a high energy bill? Some might say countless times.
But despite what you may think, there are solutions to saving on your energy bill that business owners often overlook.
Danny Guselli spoke with the brand and communications manager at Prominent Energy Solutions, Lindo Ngema.
According to their website, "The team at Prominent Energy Solutions specialise in providing sustainable energy solutions for both residential and commercial clients. Our team of experts is committed to making the transition to solar energy as smooth and efficient as possible, while ensuring the highest workmanship quality."
Read more: Eskom opens bids for green energy company
Danny started by asking Ngema to explain the term 'Tariff Optimisation' and its importance in businesses.
Ngema said, " It's a study of reviewing your electricity bill to see whether your business adopts the proper tariff structure because people do not pay the exact unit cost. It's all about reviewing your bill and studying your energy in real time to migrate your current adopted price plan to the most optimal tariff structure."
Danny asked, "How do businesses know if they are on the wrong tariff?"
Ngema responded, " One of the ways to see if you're still receiving an estimated bill is if you are on an outdated tariff and have an old type of meter and infrastructure. Sign number two, most probably, you are a 24-hour operating business. You might be a shop that closes at night, but still has fridges running overnight, and you are being billed on a flat rate. You need something that's gonna give you off-peak charges where the prices drop at night, as well as the weekend, or probably you are eight to five, but you've got a lot of billings that go into your bill."
The last way to identify incorrect tariffs could be if you have moved into a new facility previously occupied by another business. "You might find that your service fees and demand charges are based on the old facility, because in most cases, when people occupy new facility for operations, they're just happy that the lights are on. They never really look into the tariffs, you know? Ngema said.
Watch the customer testimonial after using Prominent Energy Solutions, courtesy of YouTube.
Read more: An energy-saving tip to help cut your costs
Danny came in with the big guns and asked, " Why are there different tariff structures, and I'm gonna be bold and say, should we call it price discrimination?"
Ngema said, " It's definitely price discrimination if you look at it. But remember, Eskom and the municipality do not have a say regarding the unit cost. We've got NERSA, which regulates pricing. Many people hear about NERSA when Eskom is looking for a price increase. But I'm gonna shock you today because sometimes Eskom would ask for a bigger percentage increase in electricity, and then they don't find it. Still, they end up recouping the portion they were not granted by putting people on the wrong tariff."
" While NERSA get to set the pricing for consumers, NERSA's (National Energy Regulator of South Africa) responsibility is to protect consumers. So they introduce a lot of tariffs that seek to help consumers afford their tariff structures. There are a lot of tariffs that the municipality and Eskom would have running, and consumers are on those tariffs, while NERSA is discontinuing them.
What Eskom and the municipality do is put fine print on their website, saying these tariffs are no longer available to new customers. But remember, when the new ones were introduced, the majority of consumers were already on those ones. So instead of running a campaign to remove people from this tariff, they introduce new ones that are much more affordable but don't necessarily convert customers to those tariffs.
With tariff optimisation, the business or resident examines their current payment and ensures that they are converted to an updated, more cost-effective NERSA-approved tariff that is in line with their municipality bill.
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