Councillor Edward Von Bodenstein of the Democratic Alliance in Emfuleni gives this information regarding the frustrating SmartMeter situation:
The past week has seen the residents of Emfuleni Municipality been plunged into darkness due to lack of foresight and planning by the municipality in the handling of the smartmeters contract.
BACKGROUND
On or around 2012, the tender for electricity smart metering was advertised.This type of tender was meant to be a “PPP”(Public Private Partnership) as such national treasury’s approval was necessary.
There were only two companies who responded to the “RFP” namely BXC South Africa, a Chinese entity and Power.com, who apparently was local. During the Bid Adjudication “BA”, it became apparent that Power.com’s tender was incomplete and subsequently BXC was awarded the tender.
PERIOD GOING FORWARD
It is important to note that ELM did not have the necessary funding for this kind of project, and as such BXC, undertook to fund the entire project in return of a profit split of 80% to BXC and 20% to Emfuleni Municipality.
Under normal supply chain regulations, a contract would run for a period of three years, however, BXC made submissions to treasury to have the contract run for ten years in order to realise profit, which was granted.
The initial contract started in 2013, with both parties having endorsed clauses for penalties in terms of performance.Which performance would be non-failure by BXC of its product and the political will by Emfuleni to persuade the community to accept the concept of smartmeters.
It is also important to mention that whilst council agreed to this project, the Democratic Alliance recorded its reservation.
It is also important to mention that according to BXC, during the subsistence of the contract, BXC never received any payments from Emfuleni Municipality.
It became apparent that the contract was not yielding its intended benefits as the community was rejecting this concept outright-due to failure by the ruling party to have canvassed this to the community.
LEGAL BATTLE
On or around 2017, the then mayor, Jacob Khawe instructed that the project be cancelled. BXC responded by demanding R30 million payment for invoices submitted to Emfuleni Municipality. Failure by Emfuleni Municipality saw BXC resorting legal proceedings.On or around 2018, BXC filed for an application forcing Emfuleni Municipality to honour performance as well as payment of invoices.
On or around June 2018, Emfuleni Municipality, issued out a tender for electrical meter replacement.BXC challenged this move by Emfuleni Municipality in court and won.
TERMINATION OF CONTRACT BY BXC
On or around April 2019, BXC started with the termination process.Finally on or around June 2019, BXC withdrew the application for specific performance and substituted same with a motion to terminate the contract with Emfuleni Municipality.According to BXC, Emfuleni Munucipality did not respond.According to BXC, they did not switch off the system, and on or around June 2019 Emfuleni Municipality proposed to enter into a transitional contract with BXC.
TRANSITIONAL CONTRACT
According to BXC, Emfuleni Munucipality undertook to pay a daily rate of R90 000 excluding VAT. Acccording to BXC, Emfuleni Munucipality only paid three invoices. This resulted in the nullification of the transitional contract. BXC, then again approached Emfuleni Municipality with a proposal of R2.8m per month for three months, this, after Emfuleni Municipality undertook to take over the smatrmeter project. According to BXC, the proposal above also did not realise.
STATUS QUO
According to BXC, on 3rd August 2019, Emfuleni Municipality instructed the electricity vending service provider Ice Cloud to switch off the vending system. BXC indicated that they have never in their part switched off the system, and are still committed to assist Emfuleni Municipality with the handover.Their intention is to leave the system running, even though they were forced to terminate the contract on 14th July 2019. They were however suing Emfuleni Municipality for damages arising out of the contract.
CONCLUSION
We submit as the Democratic Alliance that, lack of planning and foresight is the cause of this current debacle. A government that is non-carring for its citizens always acts ex post facto. We therefore reject this failure by Emfuleni Municipality with the contempt it deserves and we will always act in the best interests of our communities.
Councillor Edward von Bodenstein – 10-08-2019
