Eskom to cut power to defaulting municipalities
The utility will interrupt bulk electricity supply to the top 20 defaulting municipalities across the country.
JOHANNESBURG - Power utility Eskom has announced it plans to interrupt bulk electricity supply to the top 20 defaulting municipalities across the country with effect from 5 June 2015.
It says that of the R4,6 billion owed to Eskom by municipalities, the top 20 defaulting municipalities are currently indebted to Eskom to the amount of R3,68 billion.
The utility says while power cuts, of four hours in the morning and four hours in the evening, will cause undue hardship on consumers, non-payment for electricity undermines its obligation to generate and supply power to municipalities nationally on a financially sustainable basis.
We have therefore decided to exercise our right according to the provisions of the Electricity Regulation Act 4 of 2006 and the supply agreement with municipalities, which entitled us to disconnect the supply of electricity to defaulting municipalities, says interim chief executive Zethembe Khoza
The utilitys Kulu Phasiwe tells Eyewitness News the company is now taking drastic measures to ensure it is paid.
We have decided as a company that we needed to get that money back. And we are now saying from 5 June we are going to interrupt their electricity supply if they do not pay the money.
The top 20 defaulting municipalities are
- Maluti-a-Phofung Municipality
- Matjhabeng Municipality
- Emalahleni Local Municipality
- Ngwathe Local Municipality
- Thaba Chweu Local Municipality
- Lekwa Local Municipality
- Govan Mbeki Municipality
- City of Matlosana Local Municipality
- Naledi Local Municipality
- Thabazimbi Local Municipality
- Msukaligwa Local Municipality
- Lichtenburg Municipality
- Nala Local Municipality
- Makana Local Municipality
- Madibeng Local Municipality
- Randfontein Local Municipality
- Dihlabeng Municipality
- Nketoana Local Municipality
- Nama Khoi Local Municipality
- Westonaria Local Municipality
The location of the defaulting municipalities. Source: EWN.
Energy expert Ted Blom says this type of action was expected.
As we get to June thats the crunch date that we forecast that Eskom will really have severe problems on all sides. So its not unexpected.
However, I think they are treating the symptoms as opposed to the cause as the municipalities are symptomatic of local council issues.
Earlier in the day government welcomed a R4 billion loan to Eskom from the German Development Bank which is set to help the utility with its financial woes, and more specifically with its renewable energy projects.
Phasiwe said spending the money on renewable energy projects was one of the conditions of the loan.
He explains the utility is building a 100 MW solar plant in the Northern Cape, and the loan will also be used to connect renewable energy projects that government is busy with through the Department of Energy.
The power utility on Tuesday said while it remained financially constrained, government wouldnt allow it to become bankrupt.