Eskom sold 178,032GWh of electricity in the 2026 financial year, down from 218,120GWh in 2007, an 18.38% contraction and a two-decade low. Over the same period, its revenue rose 785.3%, from R40.1-billion to R354.7-billion.

The gap is explained by tariffs, which increased 1,105%, putting the price per unit at 12.05 times its FY07 level. Nominal generation capacity meanwhile hit a record 47,378MW, up 25.46% on FY07.

The tariff was both the fix and the cause. Eskom's original pricing prioritised affordability and failed to recover the true cost of supply, which left it unable to build reserves for new generation. NERSA then approved increases to restore cost recovery, and those increases worked on the balance sheet while steadily weakening demand. Add years of load shedding, and households and businesses moved to rooftop solar and other alternatives, shrinking the customer base Eskom recovers its fixed costs from.

That pushes it toward asking for further increases, which makes the alternatives more attractive again. Municipal debt compounds it.

Effectively negligible in FY07, municipal arrears reached R111.6-billion by FY26, and Eskom projects them breaching R358-billion by FY31. The operational side has genuinely improved, with 365 consecutive days without load shedding achieved in May, and FY26 delivered a second consecutive profit of R30.3 billion after seven straight loss-making years from FY18 to FY24.

Daily Investor compiled the 20-year series from Eskom's annual reports, with charts from The Outlier, and describes the tariff strategy as a double-edged sword that sustained revenue while undermining demand. Eskom's FY26 results confirm the R354.7-billion revenue figure and the R30.3-billion profit. Business Day reported on those results that weaker sales now pose the new problem, with chief financial officer Calib Cassim saying the utility must convert surplus capacity into sales.

Twenty years ago Eskom could not meet demand. Now it has record capacity, a two-decade sales low, and 2 to 3GW of surplus it needs to sell. Every tariff increase that fixes the income statement gives another customer a reason to leave, and each departure leaves the same fixed costs spread across fewer payers.

That is why Cassim is offering discounted three-to-five-year tariffs to smelters, and why data centre load has suddenly become interesting. For a business with real consumption, the negotiating position has genuinely reversed, and it is worth testing.

The projection to watch is municipal arrears at R358-billion by 2031, because that is the number that decides whether the turnaround holds or whether the pricing policy ends up recovering it from whoever is still connected.

You might also like our piece on Cape Town buying power below Eskom rates, the Eskom distribution agency agreements taking over failing municipal networks, and the Mpumalanga solar levy now facing a legal challenge.

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