Farmers who installed solar power systems to reduce their dependence on Eskom might be in for an unpleasant surprise. While the national utility secured a 12.74% average tariff increase from Nersa in January 2025, the new pricing structure that came into effect on April 1, 2025, hits grid-tied solar users much harder – especially those who "bank" surplus solar production by offsetting it against the farm's consumption at the same time-of-use tariff bands.
Detailed analysis by Sonfin, a solar energy adviser working primarily with farmers, shows that medium to large irrigation farms can expect their electricity bills to rise by as much as 18% to 26%. These are farms that already generate a significant portion of their power from solar but remain connected to the Eskom grid to ensure reliability and to export excess power. Instead of being rewarded for their investment in renewable energy, they are now being penalised by an increase in fixed charges and a sharper seasonal shift in time-of-use tariffs – particularly during summer, which now spans nine months of the billing year.
The message is clear: relying on Eskom – even partially – is becoming more expensive and less predictable, particularly for solar-powered farms that once viewed the grid as a flexible backup.
The implications are worrying for the agricultural sector, which is already under pressure to stay competitive in international markets. Energy reliability is essential not only for irrigation schedules but also for cold chains and processing plants. When power is available but not at the right time, crop quality and shelf life suffer.
What’s more, the new tariff structure undermines the core logic of grid-tied solar. Farmers who export excess energy are credited at the same rate they would pay to buy electricity at that time – but that rate is now so skewed by peak/off-peak fluctuations and fixed charges that the economics no longer work in their favour. The fixed portion of the bill has become so dominant that reducing consumption or exporting solar delivers diminishing returns.
This has prompted industry leaders like AgriSA to encourage farmers to think seriously about alternative energy strategies. But if solar alone is no longer the most viable option, what is it?
One technology that is gaining attention is the gas engine generator, especially in a Combined Heat and Power (CHP) configuration. Guascor gas engines – available in sizes from 220kVA to 2MVA – can run on readily available LPG (liquefied petroleum gas), making them a practical choice for rural and semi-rural areas in South Africa.
Unlike solar, gas engines provide both baseload and dispatchable power: they can run constantly or be turned on exactly when needed, regardless of the time of day or weather. When configured as a CHP system, they achieve overall efficiencies above 80% by capturing waste heat for steam, hot water, or absorption cooling. This makes them ideal for operations like greenhouses, abattoirs, dairy processing plants, and irrigation farms that need both electricity and thermal energy. They are especially ideal for energy intensive but seasonal operations, like fruit processors or packhouses which only operate for 5 or 6 months of the year.
The business case becomes even stronger under the new Eskom tariff paradigm. Rather than paying escalating grid tariffs and unavoidable fixed charges, farmers can lock in a portion of their energy costs with LPG supply agreements and reduce exposure to a volatile, coal-heavy grid. LPG-powered CHP systems also reduce greenhouse gas emissions and align with global sustainability standards, giving export-focused producers a competitive environmental edge.
Rather than abandoning solar altogether, some farms may shift to hybrid systems that combine solar PV, battery storage, and gas engines. Solar can still handle daytime loads, while batteries provide smooth and short-term backup. Gas engines can then take over during peak demand periods or bad weather, maintaining critical loads when grid power is either unavailable or prohibitively expensive. A lower capacity, and thus lower fixed charge, Eskom connection may still be retained to “trickle charge” batteries during off-peak or off-season months.
The new Eskom tariffs are more than a price hike – they represent a structural change that upends the economics of energy in agriculture. For solar-using farmers, they are a wake-up call. For gas engine technology, they are opening.
Now more than ever, farmers need dispatchable, reliable and cost-effective power. And increasingly, that power won’t come from the grid.
