Ramokgopa steps into Joburg’s latest Eskom mess
Energy minister Kgosientsho Ramokgopa has stepped into the growing mess between Eskom and the City of Joburg, in an attempt to mediate the very public spat between the two.
The minister is meeting with Joburg mayor Dada Morero on Monday (11 November) for a formal engagement on how to best address the situation.
Eskom issued a statement late on Thursday (7 November) threatening to disrupt power to South Africa’s ‘richest’ city should it fail to pay the billions of rands it owes to the national utility.
Eskom said that the City of Joburg and its utility City Power currently owe it R4.9 billion in outstanding bill, excluding the current account of a further R1.4 billion, which will become due and payable at the end of November 2024.
This takes the total owed to R6.3 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.
The utility said that this was not what the parties had agreed to—while the City of Joburg said that Eskom was being a bully, expecting full payment while investigations into the overbilling were ongoing.
According to civil action group Outa, the entire mess is of CoJ’s own doing, and the fact it is complaining about Eskom’s billing approach is deeply ironic.
“Residents who have disputed bills in the past will have little sympathy for the CoJ over the ‘pay first, ask questions later’ approach, as this is how the CoJ treats its own customers,” it said.
Outa noted that Eskom’s dispute with the CoJ had already been in court this year, and the city was ordered to pay up on Eskom’s terms.
In July, the court ordered the City to pay Eskom R1.074 billion plus interest and legal costs, after both parties agreed that they could not settle the facts of the billing dispute through court papers.
“The court was told that the electricity supply agreement between Eskom and the City states that the City must pay its electricity account even if it disputes it, provided that the account will be corrected if an error is later revealed,” it said.
In September, in another development in the billing dispute, Eskom went to court to demand payment of R4.5 billion for the bulk supply for April, May and June 2024; the matter was struck from the roll.
The CoJ itself is owed billions by residents. The amount owed to the city over 90 days overdue is over R51 billion.
However, Outa again blames the city for this.
“Tariff increases, falling services, and increased nonsensical punitive policies like solar charges and prepaid meter fees have left people defaulting and checking out of the municipality’s shambolic billing,” it said.
Anxiety
The city urged Eskom to retract its threat to cut power to the city.
According to Morero, the public spat was causing unnecessary anxieties among city residents and businesses, and “multiple interpretations” of the situation were to blame.
“It is our shared responsibility as elected officials to take ownership of the narrative and provide clear and accurate information to the public,” said Morero.
“Our primary focus is to resolve this matter in the best interests of the people of Johannesburg.”
The mayor and the minister have scheduled a formal engagement for Monday, during which they will “collaborate to develop solutions that ensure the uninterrupted provision of services to Johannesburg’s residents”.
Eskom, meanwhile, has given the city and other stakeholders time until mid-December to convince it why it should not start disrupting power over the R6.3 billion debt.
“A final decision on whether Eskom will proceed with the interruption will be communicated after a review of the representations received on 12 December 2024,” it said.
Eskom is struggling to get a grip of its municipal debt, which could spell disaster for the country.
“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,” it said.
Warnings have already rung out that Eskom’s rising municipal debt could reach R200 billion within a few years – and R1.3 trillion by 2050 – and if this isn’t resolved urgently, Eskom, municipalities, and South Africa’s entire economy could collapse.
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