Eskom attaches debt-ridden Emfuleni’s bank accounts to recover R8bn

The Sheriff of the Court has successfully attached the Emfuleni Local Municipality’s four bank accounts to ensure that money collected for electricity is paid directly to Eskom.

The R8 billion owed to Eskom by Emfuleni for bulk electricity represents about 10% of the total R82bn owed by municipalities and places Emfuleni among the top three municipalities in debt to Eskom.

A notice was handed to the National Treasury and Emfuleni Local Municipality in July this year, saying that Emfuleni is no longer a beneficiary of the Municipal Finance Management Act (MFMA) 124 Debt Relief Programme due to multiple breaches.

Emfuleni not compliant

Eskom spokesperson Daphne Mokwena said the Emfuleni municipality failed to comply with the requirements of the National Treasury debt relief programme.

“The attachment of the bank accounts allows Eskom to receive payment for the electricity it supplies, ensuring continued service to the municipality’s customers. Eskom has exhausted all legal and mediation avenues to secure payment for services rendered since 2018.

ALSO READ: City Power granted leave to appeal Eskom ruling on billing dispute

“Collecting municipal debt is a key focus for Eskom. The company will employ various strategies to recover owed funds, enabling investment in maintaining and strengthening electricity supply, fostering socio-economic growth, and reduce the need for interventions such as load shedding,” Mokwena said.

Electricity debt

Mokwena said Eskom cannot financially sustain the electricity debt of the municipality without severely impacting its own operations and the citizens of the country.

“The municipality’s failure to pay for bulk electricity compromises Eskom’s financial stability and its ability to provide affordable electricity. As of 31 August 2024, Emfuleni owes R8,052,093,269.36 for bulk electricity.

“This amount represents 10% of the total R82 billion owed by municipalities and places Emfuleni among the top three municipalities in debt to Eskom,” Mokwena said.

Mokwena added that municipal debt remains one of Eskom’s biggest challenges.

“As of the end of March 2024, municipal arrears stood at around R74.4 billion, with an increase of approximately R15.9 billion during the last financial year (1 April 2023, to 30 March 2024),” Mokwena said.

ALSO READ: AFU freezes R29m assets linked to syndicate who stole from Eskom