Small-scale Embedded Generation (SSEG) tariffs

The document outlines a framework for municipal electricity tariffs in South Africa to accommodate renewable energy generation. It recommends a structure comprising network costs, service charges, and time-of-use energy charges, while introducing feed-in tariffs to compensate customers for exporting electricity. The brief emphasizes the need for long-term payment security to reduce investment risk, the use of cost-of-supply studies to ensure revenue sufficiency, and the importance of keeping grid-tied options more attractive than off-grid alternatives to prevent grid defection.

• Modern electricity tariffs should consist of three primary elements: a fixed network cost based on connection size, a fixed service charge for retail network provision, and a variable time-of-use (TOU) energy charge. To ensure equity and transparency, network costs and service charges should be applied consistently across both SSEG and non-SSEG consumers.
• Municipalities should implement feed-in tariffs to pay customers for electricity exported to the grid. These can be designed using a 'value-based' approach, which pays what the energy is worth to the grid (including avoided costs and externalities), or a 'cost-based' approach, which covers the customer's generation costs plus a targeted return.
• To lower the risk profile for PV investments and reduce the need for high tariff incentives, municipalities should provide long-term price security by guaranteeing feed-in tariff payments for as close to the project's lifetime as possible.
• Tariff design must ensure that remaining connected to the grid is more attractive than off-grid alternatives to prevent 'grid defection,' which would jeopardize the revenue municipalities use to cross-subsidise poor customers and other services.
• Before implementing new tariffs, municipalities should conduct a full cost-of-supply study to determine true fixed and variable costs and develop accurate customer load profiles using high-resolution demand data to model revenue impacts and fairness.

APA

GreenCape (n.d.). Small-scale Embedded Generation (SSEG) tariffs. https://greencape.co.za/assets/Energy-Sector-Desk-Content/Basic-tariff-principles-for-small-scale-embeddd-generation-FINAL-v1-22Sep16.pdf

Chicago

GreenCape. Small-scale Embedded Generation (SSEG) tariffs. n.d. https://greencape.co.za/assets/Energy-Sector-Desk-Content/Basic-tariff-principles-for-small-scale-embeddd-generation-FINAL-v1-22Sep16.pdf.

Wikipedia

{{cite report |author=GreenCape |title=Small-scale Embedded Generation (SSEG) tariffs |url=https://greencape.co.za/assets/Energy-Sector-Desk-Content/Basic-tariff-principles-for-small-scale-embeddd-generation-FINAL-v1-22Sep16.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{greencapendsmallscale, author = {{GreenCape}}, title = {{Small-scale Embedded Generation (SSEG) tariffs}}, institution = {GreenCape}, url = {https://greencape.co.za/assets/Energy-Sector-Desk-Content/Basic-tariff-principles-for-small-scale-embeddd-generation-FINAL-v1-22Sep16.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }