Eskom says City of Tshwane owes it R635m

Eskom’s struggle to keep the lights on has been exacerbated by a number of indebted municipalities that owe the utility millions. 

The latest municipality to be listed as owing Eskom is the City of Tshwane, which according to a statement is in payment arrears by R635 million. 

A meeting with Tshwane mayor Randall Williams and his leadership team took place earlier this week, where the issue of irregular payment pattern over the past six months were discussed.

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“Over the past months, we have engaged the City on these irregular payments and the impact they have on Eskom to keep the lights on.

“The overdue debt has contributed negatively to the liquidity, financial performance and sustainability of the organisation, where Eskom has to borrow to meet its financial commitments.” 

Currently, the power utility is more than R43.8 million in debt itself. 

Eskom said it would take “appropriate measures” to recover the money owed to them, but remained “hopeful” that the city would pay their debts. 

Eskom power cuts

In November last year, Eskom cut electricity supply to around 700 customers living in Diepkloof Zone 3, Soweto, due to “high energy losses as a result of illegal connections, meter bypassing and buying electricity from ghost vendors”. 

“In the past eight months, Eskom has lost revenue of approximately R96 million in the area of Diepkloof alone, where customers’ buying trends are dismally low since their conversion from post-paid to prepaid meters; which were installed to assist them to take better control of their electricity consumption.”

This prompted intense protest action and claims from residents that Eskom was imposing “unrealistic” fines. 

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A R6 000 fine was said to have been instituted by Eskom, Soweto residents said, until an investigation into its contractors who were supposed to install prepaid meters in the different townships got underway. 

City of Johannesburg mayor Mpho Phalatse, however, said not paying for electricity was theft. 

“We urge the customers that are paying for electricity to work with us to expose those who are not paying, and also call out those who continue to steal electricity from Eskom.

“Not paying for electricity is theft,” says Phalatse in a statement following a meeting with Eskom Gauteng management in December last year.

Rejecting price hike

Last week, Williams added his voice to rejecting a proposed electricity price hike. 

Eskom made a submission to the National Energy Regulator of South Africa requesting a series of double-digit increases over the next three years.

According to a statement released by the City on Monday, Eskom has requested a 20.5% increase for the 2022/23 financial year, followed by a 15.07% increase the following year and a 10% increase the year after that.

“While we acknowledge that Eskom is having financial difficulties and is working towards turning around its business model, it cannot shift this responsibility to consumers,” Williams said.

ALSO READ: City of Tshwane rejects proposed Eskom tariff increase