Load reduction: Ramokgopa says households consuming illegally costing Eskom R3bn a month

Electricity and Energy Minister Kgosientsho Ramokgopa has revealed that over 2.1 million consumers are not paying for electricity, costing Eskom approximately R3 billion per month.

Ramokgopa and Eskom officials, including CEO Dan Marokane, testified at the South African Human Rights Commission (SAHRC) Inquiry into load reduction on Tuesday.

The inquiry has heard testimony on how Eskom’s load reduction measures have disproportionately impacted poor communities, crippling small businesses and putting the lives of vulnerable individuals at risk.

Ramokgopa on load reduction

On Tuesday, Ramokgopa stated that “zero buyers” have gone over a year without paying for electricity but continue to consume it.

“[At least], 2.1 million customers are bypassing so these are people who are consuming illegally.

“They have never purchased a unit of electricity in the past 12 months, and yet they are consuming, costing Eskom upwards of R3 billion per month,” he said.

The minister explained that overloaded transformers in townships force Eskom to implement load reduction, affecting entire communities, including paying customers.

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“You are going to find that there is a relationship between the density, the concentration of those that are bypassing and the issues of load reduction.

“What is the big point I’m making? The biggest casualties of load reduction are those that are paying.”

When a transformer fails, Ramokgopa highlighted, it impacts all users in the affected area.

“That transformer can’t carry the weight, and what do municipalities and Eskom do? They choose to protect the asset and protect the users and the people in that vicinity.”

Watch the inquiry below:

Eskom crackdown on illegal connections

The minister also stated that following Eskom’s aggressive crackdown on illegal connections, 400 000 customers requested to have their electricity legally connected.

“What the government is doing now in attempt to sustain the grid is to invite those who are bypassing to present themselves to Eskom to be connected legally. We shall provide you with smart meters and basic electricity subsidy.”

Ramokgopa also revealed that 1.6 million households in South Africa still lack access to electricity.

READ MORE: MPs scold Eskom after AG report highlights little progress

To address this, Eskom is expanding the grid by constructing power transmission lines and substations to reach underserved areas.

“The problem with that approach is that is very expensive. 

“The R4  billion that I say it’s an allocation we get per annum is going to be significantly insufficient because the bulk of that money will be spent in building the lines and the transformers to get it to poor households.

“So, we do that, especially in urban areas, because it’s more efficient to do it.”

He added that off-grid solutions are also being considered as an alternative.

Overloading risk due to load reduction

Marokane highlighted that illegal connections contribute to system overload and pose serious risks to infrastructure and public safety.

“From a technical point of view, the overloading is explained as when the equipment transformer starts to operate above the legal safety limits, and that is as a result of the demand being pulled from it being higher than its design, you start getting to a point where your in-built safety systems will kick in and trip the equipment.

“But what we see in the areas where there’s illegal connections, even though safety measures are bypassed, the end result is many pictures that you may have seen of this equipment exploding, causing fire, damaging infrastructure, and also bringing health and safety risks.”

READ MORE: Electricity tariffs: Ramokgopa reveals how much Eskom customers pay for usage per month

He clarified that load reduction is not due to a lack of generation capacity but rather a result of local overloading caused by illegal connections.

“Generation capacity is there; it’s adequate. This is localised.

“It’s localised to an area where the prevalence of illegal connection is high, the prevalence of meta-bypassing is high, and as a result of that, there’s a mismatch between the installed capacity and what the demand at that localised point is looking like.

“Unfortunately, in that space you also have customers that may be paying, that are paying.”

Meanwhile, Eskom’s executive for distribution, Monde Bala, stated that at least 7.2 million South African households have been transitioned to smart meters as part of efforts to combat illegal connections and meter bypassing.