Tariffs: Water and Electricity

Introduction

• Focus: Understanding tariffs for water and electricity.
• Importance: Example at the end is from an exam question and is crucial for understanding.

Understanding Tariffs

• Definition: Different pricing for different usage categories.
• Example: Water tariff calculations.

Water Tariffs

Measurement and Pricing

• Unit: Kiloliter (1 kiloliter = 1000 liters)
• Pricing: Given per kiloliter.
• VAT Consideration: Excludes or includes VAT; lesson assumes 15% VAT.

Example Problems

1. C Port's Usage:

   • Usage: 33 kiloliters
   • Calculation:
     • 0-9 kiloliters: 9 × 9.50 = 85.50
     • 10-25 kiloliters: 16 × 11.22 = 179.52
     • 26-30 kiloliters: 5 × 14.95 = 74.75
     • 31-33 kiloliters: 3 × 23.05 = 69.15
   • Total: 408.92 Rand (VAT exclusive)

2. Megan's Usage:

   • Usage: 29 kiloliters
   • Calculation:
     • 0-9 kiloliters: 9 × 9.50 = 85.50
     • 10-25 kiloliters: 16 × 11.22 = 179.52
     • 26-29 kiloliters: 4 × 14.95 = 59.80
   • Subtotal: 324.82 Rand
   • Including VAT: 324.82 × 1.15 = 373.54 Rand

3. Lerato's Usage:

   • Usage: 51 kiloliters
   • Calculation:
     • 0-9 kiloliters: 9 × 9.50 = 85.50
     • 10-25 kiloliters: 16 × 11.22 = 179.52
     • 26-30 kiloliters: 5 × 14.95 = 74.75
     • 31-45 kiloliters: 15 × 23.05 = 345.75
     • 46-51 kiloliters: 6 × 25.36 = 152.16
   • Subtotal: 837.68 Rand
   • Including VAT: 837.68 × 1.15 = 963.33 Rand

Electricity Tariffs

Measurement and Pricing

• Unit: Kilowatt hours
• Pricing: Cents per kilowatt hour
• VAT Consideration: Includes or excludes VAT

Example Problems

1. Filler's Usage:

   • Usage: 170 kWh
   • Calculation:
     • 0-120 kWh: 120 × 112 = 13,440 cents
     • 121-170 kWh: 50 × 135 = 6,750 cents
   • Total: 20,190 cents = 201.90 Rand (VAT not altered)

2. Bang's Usage:

   • Usage: 238 kWh
   • Calculation:
     • 0-120 kWh: 120 × 112 = 13,440
     • 121-180 kWh: 60 × 135 = 8,100
     • 181-238 kWh: 58 × 148 = 8,584
   • Subtotal: 301.24 Rand
   • Including VAT: 301.24 × 1.15 = 346.43 Rand

3. Anton’s Usage:

   • Usage: 302 kWh
   • Calculation:
     • 0-120 kWh: 120 × 112 = 13,440
     • 121-180 kWh: 60 × 135 = 8,100
     • 181-250 kWh: 70 × 148 = 10,360
     • 251-302 kWh: 52 × 185 = 9,620
   • Subtotal: 415.20 Rand
   • Including VAT: 415.20 × 1.15 = 477.48 Rand

Special Exam Question

• VAT 14%: Uses older VAT rate
• Water Tariff:
  • Categories and rates given differently, with Rand per kiloliter
  • Example: Thomas uses 10 kiloliters
  • Calculation involves understanding usage per category and adding VAT

Steps

1. Calculate Usage in Categories: 6 kiloliters in first, 4 in second
2. Cost Calculation:
   • First category: 6 × 11.91 = 71.50
   • Second category: 4 × 12.15 = 48.61
   • Total (without VAT): 120.11
3. Add VAT: Multiply by 1.14 to include VAT, result is 136.93 Rand

Conclusion

• Key Learning: Understand how tariffs are structured and how to calculate total usage costs including VAT adjustments.
• Application: Essential for exams and real-life situations where such tariffs apply.