Eskom caught between a rock and a hard place

The dimmer switch has been applied to the legal attempt by power utility Eskom to recover massive and mounting debts from recalcitrant municipalities.

The decision to not suddenly plunge whole communities into darkness is wise. As is allowing another week for debtors to negotiate repayment terms – accompanied by the threat of daily two-hour blackouts for those who don’t.  But it  would seem to be worsening the problem.

Eskom has painted itself into an uncomfortable corner. It’s positioned itself to be the villain if it carries out the blackout threat. But it will be more of a villain if what seems like a dysfunctional financial model fails as it has in the past.

That will see prices hiked even higher as the begging bowl is hauled from under the boardroom table and waved frantically at government. Meanwhile, more and more potentially lethal illegal connections will be rigged up.

It must be asked how, if the councils in question cannot pay their electricity bills now, are they expected to meet them tomorrow? Never mind paying off the arrears, which are likely to escalate rather than diminish.

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