New Eskom boss draws the line with owing municipalities

Brian Molefe says customers shouldn’t be punished because municipalities don't pay their debts.

FILE: New acting Eskom CEO Brian Molefe (C) briefing media after what he's called a robust meeting with Members of Parliament on 22 April 2015. Picture: Gaye Davis/EWN

JOHANNESBURG - New acting CEO of Eskom Brian Molefe says households who pay their electricity bills shouldn't be punished by being cut off if their municipalities don't pay their debts to the utility.

He's suggested that defaulting municipalities should be bypassed.

Molefe, who along with members of the Eskom board and top executives briefed Members of Parliament and the media in Cape Town yesterday, said if Eskom was paid upfront for electricity it would boost its bottom line.

The parastatal is currently owed billions by municipalities with about 20 at risk of having their electricity supply cut if they don't pay their arrears.

Molefe says Eskom can't continue subsidising municipalities.

"This should be an incentive for municipalities to pay on time but if they don't pay on time and if they don't meet their obligations, especially where the residents have been paying then we should have the possibility to bypass that and go directly to the customers."

Earlier, Molefe said Eskom's financial position is not as bad as it may seem and insists the power utility's problems can be solved.

He says the country must reduce its reliance on coal, which is currently the source of more than 80 percent of energy supply, and that reduced demand for electricity will also help Eskom's bottom line.

"In fact, if there's less electricity required our cost will also come down, because we will not burn as much coal and burn as much primary sources for electricity. It's not about the profitability of Eskom is about the sustainable way of providing electricity."

The acting Eskom CEO says the power utility is now focused on finding ways to do maintenance on its aging fleet of generators without load shedding.

He says an extra 3,000 megawatts is needed to close the gap between peak demand and available power when plants are shut down for maintenance and others break down unexpectedly.