Eskom threatens to cut off Joburg
Power utility Eskom has threatened to start interrupting the power supply to Joburg and its utility, City Power, in the coming months, due to the billions owed to it.
The utility said it has served a “notice of intention to interrupt power supply” to the city at certain pre-determined times of day in accordance with the Provision of Promotion of Administrative Justice Act (PAJA).
It will make a final decision on whether to move ahead with the cutting of supply by mid-December 2024, it said.
“The CoJ and/or City Power currently owe Eskom an amount of R4.9 billion, excluding the
current account of a further R1.4 billion, which will become due and payable at the end of
November 2024,” it said.
“Despite all the avenues that Eskom explored and efforts to accommodate the CoJ, the matter has reached a point where Eskom can simply no longer afford to accommodate the CoJ without putting further financial strain on and harming its own business.”
Eskom said that, in terms of the Constitution and the Intergovernmental Relations Framework, the CoJ is supposed to cooperate and assist it with fulfilling its mandate of ensuring that citizens have access to affordable electricity.
However, the CoJ has breached these obligations by not paying Eskom for the bulk electricity it supplies, making it almost impossible for Eskom to fulfil its mandate.
“When entities like the CoJ fail to pay Eskom timeously or at all, it forces Eskom to borrow additional money at premiums to fund operational costs. Operational costs should be funded by revenue generated from electricity sales and not by borrowings.
“Borrowing money to fund operational cash shortfalls caused by the failure of municipalities such as the CoJ to pay Eskom for bulk electricity increases the costs of providing electricity exponentially.”
The failure to pay by the CoJ is contributing to the growing municipal debt which, as at the end of September 2024, stands at R90 billion.
Eskom said that the city has acknowledged its indebtedness to Eskom, but it refuses to pay the full amount of its monthly bill.
Instead, the city is alleging that Eskom has been overbilling it, and is setting off this alleged overbilling against its monthly bills owed to Eskom.
Eskom said this is contrary to the electricity supply agreement and the agreements reached between Eskom, City Power and the CoJ.
“In more than one meeting, it was agreed that the CoJ would continue to pay whilst the alleged overbilling is investigated; this undertaking has been reneged on, Eskom said.
“For the reasons mentioned above, on 8 November 2024, Eskom will be issuing a public notice inviting all interested and affected parties to submit written representations, comments, and/or submissions indicating why Eskom should or should not proceed to interrupt electricity supply to the points mentioned in the PAJA notice.”
A final decision on whether Eskom will proceed with the interruption will be communicated after a review of the representations received through the PAJA process on 12 December 2024.
“Eskom will keep the media and the public updated throughout the process as significant developments arise,” it said.
City of Joburg response
The City of Johannesburg and City Power said they were “deeply concerned” by Eskom’s threat.
“The city strongly condemns this move as unjust, counterproductive, and potentially harmful to the residents and businesses of Johannesburg.
“The CoJ has consistently demonstrated its commitment to meeting its financial obligations and has engaged with Eskom to address billing issues. However, Eskom has failed to provide clarity on disputed billing charges, forcing the city to seek legal recourse to protect the rights and interests of its citizens.”
The city maintains that, contrary to Eskom’s claims, there are ongoing disputes regarding overbilling of over R3.4 billion, with a pending appeal and monthly declarations since July 2024. T
“he city has repeatedly raised concerns about this continued overbilling, which Eskom has failed to address, placing additional strain on the city’s resources.
“The City is committed to ensuring uninterrupted access to electricity for the people of Johannesburg and urges Eskom to retract its public notice and engage in genuine, good-faith negotiations to resolve these matters constructively.”
“Eskom’s approach of ‘pay now and resolve disputes later’ in its dealings with the City of Johannesburg can no longer go unchallenged. There is also an option of IGR to resolve intergovernmental disputes which Eskom keeps disregarding.”
The city said it would explore all available legal avenues to prevent disruption of electricity supply.
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