In a statement, the cash strapped municipality warned that the seizure of its assets would lead to backlogs in the delivery of basic services.
“At this stage, the municipality does not anticipate any interruption of electricity supply, except in cases of scheduled load-shedding.”
The municipality says that it has made regular monthly payments to Eskom of R1.6 billion in 2018 and 2019, and so far this year has paid almost another R1 billion.
It is trying to sign an interest free re-payment agreement with Eskom, as it is currently struggling with an interest burden of R368 million on its Eskom debt.
“In November 2019, the Emfuleni Local Municipality submitted a debt re-payment plan, which Eskom has to date not responded to,” the municipality said.
A contributing factor to Emfuleni’s big debts was Vanderbijlpark’s 1987 decision to grant large power users in the area much cheaper electricity tariffs.
Emfuleni generates more than 60% of its revenue from electricity tariffs, most of which is collected from these large companies.
Some of these companies are now paying Eskom directly – at far lower tariffs than the municipality is charging. This has added to Emfuleni’s precarious financial position.
Gauteng cooperative governance MEC Lebogang Maile is to intervene in the Eskom and Emfuleni Municipality payment debacle.
