New details about fines for South Africans with solar panels on their roofs

South African homeowners with unregistered solar electricity systems may not actually be subject to the massive penalties they were previously told they would be.

Some reports have suggested that solar users could face fines of up to R30,000 if they do not register their systems with Eskom.

However, new information made available to Daily Investor from the Organisation Undoing Tax Abuse (OUTA) indicates that this may not necessarily be the case.

OUTA CEO Wayne Duvenage said his organisation have seen no formal references by Eskom to apply fines along these lines.

“In fact, Eskom acknowledged they will not be imposing fines because they do not have the powers or jurisdiction to do so, and they will also not be cutting off electricity if you don’t register your system,” he said.

Duvenage said those who did not register their solar before the 30 September deadline would only lose out on the waiving of their registration fees and meter installation costs.

Eskom previously said it would not fine direct customers who did not register their solar systems in its small-scale embedded generation (SSEG) programme.

While Eskom has the legal power to impose fines on illegal electricity connections, it said it would not classify unregistered SSEGs as illegal, at least for the time being.

As such, Duvenage explained that Eskom would only have the legal standing to impose fines on solar connections if they did not meet its safety compliance standards.

“An SSEG system should have a Certificate of Compliance (CoC) when it is installed by a valid, registered electrician,” Duvenage said. “But this fact applies to all homes, whether you have SSEG or not.”

“It is certainly important for insurance purposes, and if your house burns down due to an electrical fault and you don’t have a valid CoC, you will land in hot water.”

Confusion over municipal charges

While Duvenage firmly clarified that Eskom itself has no legal authority to enforce fines on unregistered solar, he said the situation becomes more complicated with regard to municipalities.

This is because South Africa’s municipalities have their own executive powers and by-law processes, which allow them to impose a variety of fees and charges on municipal residents.

“When it comes to municipalities, there is a messy and erratic saga unfolding which needs government, NERSA, Eskom, COGTA and the Electricity Minister to intervene,” Duvenage said.

“Every municipality is doing something different when it comes to registration demands, fixed fees for homes with solar panels, and meter installation costs.”

Duvenage warned that without the necessary government intervention, this situation could devolve into protracted court battles for political bargaining.

However, he also reassured that this does not necessarily mean these municipalities will be able to unreservedly apply fines and charges on unregistered solar users.

This is because municipal charges cannot overrule national laws, and as such, could be subject to legal challenge if they are not reasonable and rational in how they are applied.

“These are citizens’ rights, and the rationality of charging one household a levy for panels on his roof and the other not is irrational and can be challenged,” Duvenage said.

“Here’s the next issue with these surcharges. Does the household with two panels pay the same levy as the neighbour with 16 panels? Where is the logic?”

According to Duvenage, municipalities often introduce these unreasonable charges as a means to compensate for the systemic weakening of their revenue collection models in recent years.

The embattled Emfuleni Local Municipality in Gauteng, for example, recently approved the introduction of a R2,400 application fee for solar installations, as well as a monthly levy of R463 for solar users.

However, Duvenage once again reiterated that this was not necessarily an indication that South Africans with unregistered SSEGs could be fined or disconnected.

“Despite all the threats of disconnection of those households who do not register their SSEG systems, we have not heard of any property whose electricity has been disconnected for not registering,” Duvenage said.

Daily Investor reached out to Eskom and NERSA for comment, but had not received a response at the time of publishing. The article will be updated accordingly to reflect any reply.